Report to Ranking Democratic Member, 

Committee on Agriculture, Nutrition, 

and Forestry, U.S. Senate 

United States General Accounting Office 

GAO

April 2004 BIOBASED 

PRODUCTS 

Improved USDA 

Management Would 

Help Agencies Comply 

with Farm Bill 

Purchasing 

Requirements 

GAO-04-437 
www.gao.gov/cgi-bin/getrpt?GAO-04-437. 

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact Lawrence J. 

Dyckman at (202) 512-3841 or 

dyckmanl@gao.gov.

Highlights of GAO-04-437, a report to the 

Ranking Democratic Member, Committee 

on Agriculture, Nutrition, and Forestry, 

U.S. Senate 

April 2004

BIOBASED PRODUCTS

Improved USDA Management Would Help 

Agencies Comply with Farm Bill 

Purchasing Requirements 

USDA and other federal agencies’ actions to implement the farm bill 

requirements for purchasing biobased products have been limited. USDA 

issued proposed procurement guidelines in December 2003—more than 1 

year past the deadline for final guidelines; however, these guidelines do not 

fully address the farm bill requirements for designating items for purchase 

and recommending procurement practices. USDA expects to issue final 

guidelines by April 2004 and a blueprint for the model procurement program 

by September 2004; but it anticipates that designation of existing items will 

take years to complete, possibly until 2010. In addition, new items will enter 

the market requiring further designations. Meanwhile, purchasing agencies 

do not yet have a basis for planning their own procurement programs and, as 

a result, have made only limited purchases of biobased products. 

USDA could accelerate its implementation of the farm bill requirements by 

developing a comprehensive management plan for this work and by making 

the work a higher priority. The lack of a management plan describing the 

tasks, milestones, resources, coordination, and reporting needed to 

complete this work has slowed USDA in issuing the procurement guidelines. 

For example, USDA developed a list of milestones only after GAO requested 

such a list; even then, this list was informal, primarily reflecting the thinking 

of a few officials. Without a plan, USDA will find it difficult to set priorities, 

use resources efficiently, measure progress, and provide agency 

management a means to monitor this progress. According to stakeholders, 

USDA should make this work a higher priority to speed its completion. 

Without a sense of priority, USDA’s efforts to fulfill farm bill requirements 

have not had adequate staff and financial resources. 

Stakeholders GAO spoke with generally believed that USDA’s proposals for 

testing a biobased product’s content and performance are appropriate and 

that manufacturers should bear at least some of the costs. However, 

stakeholders generally questioned the need for doing life-cycle analysis of a 

product’s long-term costs and environmental impacts. 

Biobased Products Made from Soybeans, Corn, Citrus, or Other Plant Materials 

The federal government spends 

more than $230 billion annually for 

products and services to conduct 

its operations. Through its 

purchasing decisions, it has the 

opportunity to affirm its policies 

and goals, including those related 

to purchases of biobased products, 

as set out in the 2002 farm bill. A 

biobased product is a commercial 

or industrial product, other than 

food or feed that is composed of, in 

whole or part, biological products, 

renewable domestic agricultural 

materials, or forestry materials. 

GAO examined (1) actions the U.S. 

Department of Agriculture (USDA) 

and other agencies have taken to 

carry out farm bill requirements for 

purchasing biobased products, (2) 

additional actions that may be 

needed to implement the 

requirements, and (3) views of 

stakeholders on the need for and 

costs of testing biobased products. 

GAO interviewed officials from 

USDA, major procuring agencies, 

testing entities, interested 

associations, and 15 manufacturers 

of biobased products. 

To ensure USDA’s timely 

implementation of the farm bill 

biobased purchasing requirements, 

USDA should (1) execute a 

management plan for completing 

the work, (2) identify and allocate 

the staff and financial resources 

needed, and (3) clearly state the 

priority for the work’s completion. 

USDA disagreed with the need for a 

management plan, but indicated it 

will draw on our review results and 

recommendations in future work. 
Page i GAO-04-437 Biobased Products 

Letter 1

Results in Brief 5

Background 8

USDA Delay in Issuing Biobased Purchasing Guidelines Has 

Slowed Other Agencies’ Efforts 14

USDA Could Accelerate Implementation of the Biobased 

Procurement Program by Developing a Comprehensive 

Management Plan and Assigning Adequate Resources 24

Stakeholders Generally Agree That Some Testing of Biobased 

Products Is Necessary, but They Question the Need For LifeCycle Analysis 32

Conclusions 38

Recommendations 38

Agency Comments and Our Evaluation 39

Appendix I Objectives, Scope, and Methodology 42 

Appendix II Sources for Information on Biobased Products 45 

Appendix III Key Provisions of USDA’s Proposed Guidelines 48 

Appendix IV Chronology of Steps Completed or Planned by 

USDA to Comply with the Farm Bill Requirements 52 

Appendix V Comments from the U.S. Department of Agriculture 54 

GAO Comments 59

Appendix VI GAO Contacts and Staff Acknowledgments 65 

GAO Contacts 65

Acknowledgments 65 

Contents 
Page ii GAO-04-437 Biobased Products 

Related GAO Products 66 

Tables 

Table 1: Common Biobased Industrial and Consumer Products 9

Table 2: Proposed Biobased Product Categories and Related Items 

as Listed in the Preamble 48

Table 3: Other Key Provisions of USDA’s Proposed Guidelines and 

Future Plans as Indicated in the Preamble 50

Figures 

Figure 1: Biobased Products Made from Corn Grain 9

Figure 2: Biobased Cutlery 18

Figure 3: Application of a Biobased Deicer by Interior Employee 19

Figure 4: Display of Biobased Products Used by Interior 20

Figure 5: Biobased Cleaning Products Used at USDA’s Beltsville 

Agricultural Research Center 22

Figure 6: Tractor Run with Biobased Lubricants and Fuels at 

Beltsville Agricultural Research Center 23
Page iii GAO-04-437 Biobased Products 

Abbreviations 

BEES Building for Environmental and Economic Sustainability 

DLA Defense Logistics Agency 

DOD Department of Defense 

DOE Department of Energy 

EPA Environmental Protection Agency 

GSA General Services Administration 

NASA National Aeronautics and Space Administration 

NIST National Institute of Standards and Technology 

OFPP Office of Federal Procurement Policy 

OMB Office of Management and Budget 

USDA U.S. Department of Agriculture 

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Page 1 GAO-04-437 Biobased Products 

April 7, 2004 

The Honorable Tom Harkin 

Ranking Democratic Member 

Committee on Agriculture, 

 Nutrition, and Forestry 

United States Senate 

Dear Senator Harkin: 

The federal government spends more than $230 billion annually for 

products and services to conduct its operations. Through its purchasing 

decisions, the government has the opportunity to affirm its agricultural 

and environmental policies and goals, including its goals for federal 

purchases of biobased products. A biobased product is a commercial or 

industrial product, other than food or feed, that is composed in whole or 

significant part of biological products, renewable domestic agricultural 

materials (including plant, animal, and marine materials), or forestry 

materials. For example, these products include corn-based plastics, 

soybean-based lubricants, and citrus-based cleaners.1

 Competing products 

are generally petroleum-based. The Congress recognized the potential of 

the federal government’s buying power in the Farm Security and Rural 

Investment Act of 2002 (the farm bill) and required the U.S. Department of 

Agriculture (USDA) to develop guidelines for the federal procurement of 

biobased products to create new markets for these products and to 

stimulate their production.2

 In particular, the biobased procurement 

provision is expected to promote the purchase of biobased products made 

from sustainable, raw agricultural materials in order to create economic 

opportunities in rural communities, give farmers more value for their 

 1

Biobased products—also known as bioproducts—may include adhesives, building 

materials, carpet backing, cleaners, degreasers, insulation, fuel additives, inks, lubricants, 

paints, plastics, and solvents. Corn, soybeans, vegetable (plant) oils, and wood are the 

commodities most often used in the manufacture of biobased products. 

2

See 7 U.S.C. § 8102. 

United States General Accounting Office 

Washington, DC 20548 
Page 2 GAO-04-437 Biobased Products 

commodities, and help the environment.3 In addition, according to 

proponents of the biobased procurement provision, the purchase of these 

biobased products may reduce the nation’s dependence on imported oil, 

which is currently used in many commercial and industrial products. 

However, others note that the initial purchase cost of biobased products is 

usually higher than alternatives; and consumers, businesses, and 

government agencies are generally unfamiliar with these products. 

In developing the guidelines for the procurement of biobased products, the 

farm bill requires USDA to take three major actions: (1) designate those 

items which are or can be produced with biobased products and whose 

procurement by agencies will meet the objectives of the legislation;4

 (2) 

recommend practices for the procurement of biobased products and items 

containing such materials and for certification by vendors of the 

percentage of biobased products used; and (3) provide information on the 

availability, relative price, performance, and environmental and public 

health benefits of such materials and items, and where appropriate 

recommend the level of biobased material to be contained in a product. In 

designating items, USDA is, at a minimum, to consider the availability of 

such items and the economic and technological feasibility of using such 

items, including life-cycle costs. USDA was to issue these guidelines by 

November 2002, or 180 days after the farm bill was enacted. In addition, 

within 1 year after publication of these guidelines, each federal agency is 

required to develop a procurement program that will assure that items 

composed of biobased products will be purchased to the maximum extent 

practicable, consistent with federal procurement law. Furthermore, the 

farm bill requires federal agencies purchasing items above a certain price 

to give preference to items composed of the highest percentage of 

biobased products practicable, consistent with maintaining a satisfactory 

 3

Biobased products are generally considered environmentally preferable products. Such 

products may have a lesser or reduced adverse effect on human health and the 

environment when compared with competing products. For example, biobased products 

are manufactured from renewable biological resources and are generally biodegradable 

when disposed. In contrast, products made from nonrenewable fossil resources, such as 

petroleum, generally create more adverse environmental impacts such as air and water 

pollution and global warming. 

4

According to USDA, a designated “item” will consist of similar biobased products made by 

one or more manufacturers. For example, a designated item could be hydraulic fluid that is 

described by certain characteristics, such as a minimum biobased content. The biobased 

products associated with this item would include branded hydraulic fluids that have similar 

characteristics. 
Page 3 GAO-04-437 Biobased Products 

level of competition, unless there is a price, performance, or availability 

reason not to do so.5

The farm bill also requires USDA to establish a voluntary program for 

authorizing producers of biobased products to use the label “U.S.D.A. 

Certified Biobased Product” and requires USDA to issue criteria for 

determining which products qualify for this label. The labeling criteria 

were to be established within 1 year of farm bill enactment. In addition, 

the legislation requires USDA to establish a voluntary program to 

recognize federal agencies and private entities that use a substantial 

amount of biobased products. Furthermore, the farm bill authorizes USDA 

to use $1 million of the Commodity Credit Corporation’s funds for each 

fiscal year—2002 through 2007—to support testing of biobased products 

to gather information necessary for the designation of items.6

 The 

legislation does not specify what testing should be done. To leverage 

federal funds available for biobased product testing, USDA plans to invite 

manufacturers or vendors of biobased products to voluntarily provide test 

results on the content, performance characteristics, and life-cycle costs of 

their products to assist USDA in amassing sufficient baseline information 

to designate items.7

 Subsequent to the designation of an item, USDA will 

allow manufacturers to self-certify that their products meet this baseline 

data in order to include these products in the preferred procurement 

program. 

You asked us to evaluate the federal government’s progress in 

implementing the biobased purchasing provisions of the farm bill. 

Specifically, as agreed with your office, we examined the (1) actions that 

USDA and other federal agencies have taken to carry out the farm bill 

requirements for purchasing biobased products, (2) additional actions that 

may be needed to enhance implementation of these requirements, and (3) 

 5

Federal agencies must comply with the biobased procurement requirements for any 

purchase of an item costing more than $10,000 or where the quantity of such items or 

similar items purchased or acquired in the preceding fiscal year was $10,000 or more. The 

farm bill provides that an agency may decide not to procure a biobased item if the agency 

determines that the item (1) is not reasonably available within a reasonable period of time, 

(2) fails to meet the performance standards set forth in the applicable specifications or fails 

to meet the reasonable performance standards of the procuring agency, or (3) is available 

only at an unreasonable price. 

6

The Commodity Credit Corporation is a government-owned corporation within USDA. 

7

Life-cycle analysis includes the determination of the costs of producing, using, and 

disposing of a product as well as its environmental impact. 
Page 4 GAO-04-437 Biobased Products 

views of agencies, manufacturers, and testing organizations on the need 

for and costs of testing biobased products. 

To conduct this work, we interviewed officials and reviewed the 

documentation they provided at USDA’s Agricultural Research Service, 

Cooperative State Research, Education, and Extension Service, Office of 

Energy Policy and New Uses (New Uses office), and Office of 

Procurement and Property Management (Procurement office); the four 

agencies that account for about 85 percent of all federal procurements—

the Department of Defense (DOD), the Department of Energy (DOE), the 

General Services Administration (GSA), and the National Aeronautics and 

Space Administration (NASA);8

 the Office of Management and Budget’s 

(OMB) Office of Federal Procurement Policy (OFPP); the White House’s 

Office of the Federal Environmental Executive; the Environmental 

Protection Agency (EPA); the Biobased Manufacturers Association; 

commodity groups such as the National Corn Growers Association and the 

United Soybean Board; environmental organizations such as Green Seal; 

consumer groups such as the Consumer’s Choice Council; and two testing 

entities—the Department of Commerce’s National Institute of Standards 

and Technology (NIST) and Iowa State University—that have entered into 

agreements with USDA to develop testing protocols for biobased 

products.9

 We also interviewed representatives of 15 biobased 

manufacturing companies and reviewed the documentation they provided. 

We selected these companies to provide a mix of biobased product types 

and raw materials used to manufacture these products. In general, our 

work focused on biobased products other than biofuels such as ethanol, 

biodiesel, and biogas because provisions to promote the production of 

biofuels are addressed elsewhere in the farm bill.10 We conducted our 

review from May 2003 through February 2004 in accordance with generally 

accepted government auditing standards. Appendix I provides additional 

information on our scope and methodology. 

 8

Two of these agencies, DOD and GSA, have dual roles—first, as procuring agencies 

subject to the farm bill biobased purchasing requirements and second, as major suppliers 

of goods and services to other federal agencies. Specifically, Defense Logistics Agency and 

GSA maintain central stock inventories and vendor supply lists for use by all federal 

agencies. 

9

The agreement between NIST and USDA is an interagency agreement. The one between 

Iowa State University and USDA is a cooperative agreement. 

10Farm bill biobased procurement requirements exclude the procurement of motor vehicle 

fuels and electricity. 
Page 5 GAO-04-437 Biobased Products 

While farm bill provisions for purchasing biobased products present USDA 

with a formidable challenge, its actions to implement the bill’s 

requirements have fallen short and have slowed other agencies’ efforts. 

USDA issued proposed guidelines in the Federal Register on December 19, 

2003, more than a year later than the farm bill requirement for final 

guidelines. These guidelines take only limited steps toward meeting the 

requirements of the farm bill. While the guidelines recommend some 

procurement practices and practices for vendor certification, they do not 

identify items designated for preferred procurement, or provide 

information on their availability, relative price, performance, and 

environmental and public health benefits, as called for in the legislation. 

According to USDA officials, although the agency hopes to have some 

items designated before the end of calendar year 2004, the process for 

designating other items discussed in the preamble to the proposed 

guidelines will take years, possibly until 2010. In addition, as new biobased 

items are developed and enter the market, these items will also need to be 

designated. Regarding other biobased-related requirements of the farm 

bill, USDA has not yet developed a labeling or recognition program or 

completed its work on preferred procurement practices known as the 

model procurement program. USDA anticipates that the model 

procurement program will serve two purposes: to guide its purchases of 

biobased products and to assist other agencies in developing their 

biobased procurement programs required by the legislation. In the 

meantime, as the top four procuring agencies await USDA’s fulfillment of 

these requirements—particularly the designation of items for preferred 

procurement—they have taken only limited steps to procure biobased 

products. For example, some agencies are purchasing biobased cleaners, 

lubricants, deicers, and/or dining ware because these products are more 

readily biodegradable or composted. 

USDA could accelerate its implementation of the farm bill biobased 

purchasing requirements by developing a comprehensive management 

plan for how it will implement these requirements and by making its 

compliance with them a higher priority. The lack of a comprehensive plan, 

including defined tasks and milestones, identification of available staff and 

financial resources, and a description of how the work will be 

coordinated, has contributed to USDA’s slow progress in issuing the 

biobased procurement guidelines. For example, during the course of our 

work we found confusion among USDA officials about when various 

aspects of the farm bill biobased requirements should be completed. 

USDA developed a list of milestones for fulfilling these requirements only 

after we requested such a list in May 2003; and even then, this list was 

informal, reflecting primarily the thinking of a few officials without 

Results in Brief 
Page 6 GAO-04-437 Biobased Products 

coordinating the list with another concerned office. Without a 

comprehensive plan, including clearly defined tasks and milestones, it is 

difficult to set priorities, use resources efficiently, measure progress, and 

provide agency management a means to monitor this progress. According 

to a number of officials representing USDA, other agencies, commodity 

groups, or manufacturers, USDA should also make its compliance with the 

farm bill biobased requirements a higher priority to speed the agency’s 

completion of this work. At present, without this sense of priority, USDA 

has not devoted adequate resources to fulfilling these requirements. For 

example, the USDA office responsible for developing most aspects of the 

guidelines has limited staff and has not received funding for this effort. As 

a result, this office assigned two staff on a part-time basis to develop the 

guidelines. In addition, these staff have found it difficult to compete with 

higher-priority projects for the resources they need to develop the 

guidelines. For example, these staff waited several months to receive 

assistance from staff in another USDA office with experience in rules 

preparation to help them draft the Federal Register notice containing the 

proposed guidelines. Given these problems, we are recommending that 

USDA develop a comprehensive, written plan for completing the work to 

fulfill the farm bill requirements and make clear the staff and financial 

resources and the priority to be assigned to this work so that it is 

completed as expeditiously as possible. 

Most federal agencies, testing organizations, commodity associations, and 

manufacturers we spoke with believe that testing biobased products for 

content and performance is generally appropriate; but they question the 

usefulness and costs of life-cycle analysis, which under the proposed 

guidelines, manufacturers would be required to provide to procurement 

officials upon request. According to officials from the top four purchasing 

agencies and the two testing organizations, content testing is important to 

ensure that products meet minimum biobased content specifications, and 

performance testing is a key factor in making purchasing decisions. These 

officials generally believe that manufacturers should bear the costs of 

these tests if they want to sell to the federal government. Biobased 

manufacturers generally agree with the need for these tests and with their 

responsibility for bearing at least some of the associated costs. However, 

some manufacturers said that they should be able to self-certify the 

biobased content of their products in lieu of content testing, based on their 

knowledge of their manufacturing process. Regarding life-cycle analysis, 

most of the agencies and manufacturers questioned the need for doing this 

analysis. USDA must consider life-cycle costs in designating items and has 

indicated that if manufacturers voluntarily provide life-cycle cost 

information it may help speed the designation process. Manufacturers 
Page 7 GAO-04-437 Biobased Products 

would only be required to provide this information under the rule as 

proposed if a procurement official requested the information. The 

agencies generally did not believe that the information would be useful for 

purchasing decisions because procurement staff would find the life-cycle 

analysis too detailed to follow and generally not useful without 

comparative information on petroleum-based products; USDA does not 

expect to provide such comparative information. Manufacturers generally 

agreed with this view, noting that the cost of life-cycle analysis is high—as 

much as $8,000 for a single product—and they questioned whether they 

alone should bear this cost in order to make sales to the federal 

government. However, USDA officials note that they believe such 

information would be helpful to procurement officials and that 

manufacturers could choose not to participate in the procurement if they 

did not want to provide life-cycle cost information. 

In commenting on a draft of this report, USDA said the report does not 

present a complete and balanced view of the progress made in 

implementing the biobased provisions of the farm bill, adding that the 

report emphasizes negative interpretations without fully reflecting the 

progress achieved. We believe the report provides a fair and accurate 

description of the farm bill requirements and USDA’s efforts to comply 

with these requirements to date. USDA also indicated that it disagrees with 

our recommendation on the need to develop and execute a comprehensive 

management plan. Specifically, USDA said that it does not believe such a 

plan would have accelerated its work on the proposed rule issued in 

December 2003, given the complexity of the issues that had to be resolved 

and the substantial amount of consultation across federal agencies and 

within USDA that was necessary. We disagree and continue to believe that 

USDA should develop a comprehensive, written plan that discusses, 

among other things, the tasks, milestones, resources, coordination, and 

reporting needed for completing the work necessary to fulfill the farm bill 

requirements. Furthermore, we believe that factors such as the complexity 

and breadth of the issues to be considered, the internal and external 

consultation necessary, and the farm bill’s ambitious time frames for the 

completion of this work underscore the need for a comprehensive, written 

plan. 

Regarding our recommendations that USDA clearly identify and allocate 

the staff and financial resources to be made available for implementing 

these requirements and clearly state the priority to be assigned to this 

work, USDA said it would draw on our review and recommendations as it 

approaches development of subsequent proposed rules for designating 

items and the labeling program. We believe that USDA should be more 
Page 8 GAO-04-437 Biobased Products 

proactive in this regard and make clear the staff and resources to be made 

available for completing this work and the priority to be assigned to the 

work. These matters could also be addressed in a comprehensive, written 

plan for completing the work. 

Biobased products are industrial and consumer goods composed wholly, 

or in significant part, of biological products, renewable domestic 

agricultural materials (including plant, animal, and marine materials), or 

forestry materials. These biological products and agricultural and forestry 

materials are generally referred to as biomass.11 Corn, soybeans, vegetable 

(plant) oils, and wood12 are the primary sources used to create biobased 

products. In some cases, these biobased sources are combined with other 

materials such as petrochemicals or minerals to manufacture the final 

product. For example, soybean oil is blended with other components to 

produce paints, toiletries, solvents, inks, and pharmaceuticals. However, 

some biobased products, such as corn starch adhesives, are derived 

entirely from the plant feedstock. Table 1 provides further information on 

biobased products made from plant-based resources. Appendix II lists 

sources for additional information on these and other biobased products. 

 11The farm bill defines “biomass” as any organic material that is available on a renewable or 

reoccurring basis, including agricultural crops; trees grown for energy production; wood 

waste and wood residues; plants (including aquatic plants and grasses); residues; fibers; 

animal wastes and other waste materials; and fats, oils, and greases (including recycled 

fats, oils, and greases). 

12USDA’s proposed guidelines exclude biobased products originating from a mature 

market. Therefore, wood products such as lumber or plywood made from traditionally 

harvested forest materials are excluded from the preferred procurement program. 

However, other biobased products made from wood waste or wood residues are included 

in the procurement program. 

Background 

Description of Biobased 

Products 
Page 9 GAO-04-437 Biobased Products 

Table 1: Common Biobased Industrial and Consumer Products 

Biobased source Products 

Corn Solvents, pharmaceuticals, adhesives, starch, resins, binders, 

polymers, cleaners, and ethanol 

Soybeans Paints, toiletries, solvents, inks, pharmaceuticals, lubricants, 

biodiesel, carpet backing, and foam insulation 

Vegetable oils Surfactants in soaps and detergents, pharmaceuticals, inks, 

paints, resins, cosmetics, fatty acids, and lubricants 

Wood Paper, cellulose for fibers and polymers, resins, binders, 

adhesives, coatings, paints, inks, fatty acids, and road and roofing 

pitch 

Source: Energetics, Incorporated for the U.S. Department of Energy, Industrial Bioproducts: Today and Tomorrow, July 2003. 

The many derivatives of corn illustrate the diversity of products that can 

be obtained from a single plant-based resource. As well as an important 

source of food and feed, corn serves as a source for ethanol and sorbitol, 

industrial starches and sweetners, citric and lactic acid, and many other 

products. Figure 1 shows the many uses of corn, including its industrial 

uses. 

Figure 1: Biobased Products Made from Corn Grain 
Page 10 GAO-04-437 Biobased Products 

Biomass resources are naturally abundant and renewable, unlike fossil 

resources.13 According to the DOE,14 in the continental United States, about 

500 to 600 million tons of plant matter can be grown and harvested 

annually in addition to our food and feed needs. These abundant resources 

can be used in the growing biobased products industry to help meet the 

nation’s demand for energy and products while reducing its dependence 

on imported oil.15 In addition, supplementing petroleum resources with 

biomass can provide other important benefits such as growth in rural 

economies and lower emissions of greenhouse gases and pollutants. 

According to DOE, the impacts of the growing biobased products industry 

on rural economies have yet to be quantified, but these impacts could be 

very positive.16 Expanding this industry will require an increase in 

production and processing of biomass that could provide a boost to rural 

areas. For example, expansion could create new cash crops for farmers 

and foresters, many of whom currently face economic hardship. In 

essence, this growth could move the agricultural and forestry sectors 

beyond their traditional roles of providing food, feed, and fiber to 

providing feedstock for the production of fuels, power, and industrial 

products—making these sectors an integral part of the transportation and 

industrial supply chain. In addition, development of a larger biobased 

products industry would require new processing, distribution, and service 

industries. In general, these industries would likely need to be located in 

rural communities close to the feedstock and could potentially result in 

 13Fossil resources, such as oil, coal, and natural gas, are formed in the earth from plant and 

animal remains through natural processes that take millions of years. In contrast, biomass 

is a renewable resource that can be replenished with each new growing season. 

14In general, our references to DOE in this section of the report can be attributed to 

Industrial Bioproducts: Today and Tomorrow, July 2003, a study prepared by Energetics, 

Incorporated under contract to DOE. This study was co-authored by DOE staff and draws 

on a number of sources, including prior studies issued by DOE. 

15Currently, the United States imports about 65 percent of the oil it uses. According to DOE, 

this heavy dependence on imported oil negatively affects the U.S. trade balance and 

exposes our economy to potential disruptions in supply. About 16 percent of all petroleum 

used in the United States is used in producing industrial and consumer products. The 

remainder is used in producing various fuels and distillates. 

16According to remarks made by the President in 1999, if the nation’s use of biobased 

products, including biofuels such as ethanol and biodiesel, triples by 2010, this growth 

would create as much as $20 billion annually in new income for farmers and rural 

communities by that year. In addition, according to DOE, this growth would create about 

50,000 new high technology jobs in small processing plants in rural America and up to 

130,000 such jobs in biopower, bioproducts, and biofuels industries. 

Importance of Biobased 

Products 
Page 11 GAO-04-437 Biobased Products 

positive impacts on rural communities through increased investment, 

income, taxes, and employment opportunities. 

Regarding environmental benefits, biomass is carbon-fixing, and 

represents a way to produce fuels, power, and products without 

contributing to global warming, according to DOE. Although some fossil 

resource inputs may be needed for the production of biomass and 

biobased products—such as fuel to run farm equipment, petrochemical 

fertilizers and pesticides to produce the biomass, and the energy needed to 

manufacture the biobased products made from this biomass—biomass 

removes carbon dioxide, a significant greenhouse gas, from the 

atmosphere through photosynthesis.17 The carbon component is then 

fixed, or bound up, in the biomass and stays in the biobased product made 

from this biomass for a relatively long period of time before it is released 

through biological decay. According to DOE, when petroleum is used as 

the feedstock to manufacture many products, such as plastics, up to 25 

percent of the carbon in the petroleum is lost to the atmosphere during 

production. However, producing these products directly from biomass 

reduces the carbon released during production and increases carbonfixing plant matter.18 In addition, as a renewable resource, biomass 

represents a way to recycle carbon in the environment; in contrast, the use 

of fossil resources results in a net release of carbon to the environment. 

Finally, many biobased products are readily biodegradable, meaning they 

can be safely placed into a landfill, composted, or recycled and do not emit 

hazardous volatile organic compounds or toxic air pollutants. 

According to DOE, the potential for biobased products to move into 

entirely new and nonconventional markets is substantial. New biobased 

products with improved economic and/or environmental performance 

could make significant inroads in markets historically dominated by other 

 17Photosynthesis is the chemical process by which carbohydrates are formed in the 

chlorophyll-containing tissues of plants exposed to light. Carbohydrates are compounds 

consisting of carbon, hydrogen, and oxygen that include sugars, starches, and celluloses. In 

general, plants utilize carbon dioxide from the atmosphere and water from the ground in 

the photosynthesis process. 

18According to DOE, the potential for reducing carbon released to the atmosphere through 

the substitution of biobased products for petroleum-based products is about 3.5 million 

metric tons of carbon equivalents annually by 2010. In essence, this switch includes 

substituting the energy stored in carbohydrate molecules from a renewable source (plants) 

for the energy stored in hydrocarbon molecules from a nonrenewable source (fossil 

resources such as petroleum) and would represent an increasing reliance on biology in lieu 

of geology to meet the nation’s resource needs. 
Page 12 GAO-04-437 Biobased Products 

materials. For example, according to the Biobased Manufacturers 

Association, about 300 companies are now producing nearly 800 biobased 

products to replace other materials. These companies include a number of 

major corporations or their subsidiaries. In addition, increasing 

environmental consciousness has created “green consumerism”—a 

segment of consumers who are willing to pay more for products that are 

less harmful to the environment. Currently, many of those “green” 

products are biobased, such as corn-based plastic ware, soy-based engine 

lubricants, and citrus-based household cleaners. 

Perhaps the greatest factor driving the growth of biobased products will 

be their acceptance by the public, business enterprises, and government as 

a solution to some of the nation’s most pressing resource problems. 

However, according to USDA, it often takes 15 to 20 years for a new 

material to be accepted and adopted by industry; and consumers, 

businesses, and government procurement officials are often reluctant to 

switch from familiar products to new ones. Thus, to make significant 

inroads, biobased products will need to be environmentally sound and 

competitive with traditional products in both performance and cost. The 

increased use of these products will also require favorable government 

policies, such as continued support for biobased research and 

development and affirmative procurement programs that emphasize 

biobased purchases for government needs. In addition, their increased use 

will depend on the nation’s continued desire to reduce its dependence on 

imported oil and further technology improvements that will lead to new 

applications and more efficient production of biobased products. 

In the last 10 years, the federal government has taken steps to promote the 

use of biobased products. For example, the President issued an executive 

order in 1998,19 replacing a similar executive order issued in 1993, to 

encourage federal agencies to buy products that are environmentally 

preferable and/or biobased. A subsequent executive order was issued in 

1999 with the aim of tripling the nation’s use of biobased fuels and 

products by 2010.20 Regarding legislation, the Biomass Research and 

Development Act of 2000 directs DOE and USDA to closely coordinate 

 19Executive Order 13101, Greening the Government Through Waste Prevention, Recycling, 

and Federal Acquisition (Sept. 14, 1998). 

20Executive Memorandum to the Secretary of Agriculture issued with Executive Order 

13134, Developing and Promoting Biobased Products and Bioenergy, (Aug. 12, 1999). 

Federal Efforts to Promote 

the Use of Biobased 

Products 
Page 13 GAO-04-437 Biobased Products 

their research and development efforts on new technologies for the use of 

biomass in the production of biobased industrial products. The 2002 farm 

bill reauthorized the biomass act, continued funding for biomass research 

and development programs, and set forth federal agency purchasing 

requirements for biobased products. The legislative history of the farm bill 

states that Congress enacted the biobased provisions to energize new 

markets for these products and to stimulate their production. 

With respect to promoting federal purchases of biobased products, the 

1998 executive order required USDA to issue a Biobased Products List by 

March 1999.21 Once the list was published, federal agencies were 

encouraged to modify their procurement programs to give consideration 

to biobased products. USDA published a notice in the Federal Register on 

August 13, 1999, to solicit public comments on a process for considering 

items for inclusion on this list and on criteria for identifying these items. 

As we reported in June 2001,22 USDA expected to complete this list by 

fiscal year 2002—3 years later than the executive order required. However, 

USDA did not complete the list because the 2002 farm bill set out new 

biobased purchasing requirements for USDA to implement. In the 

meantime, although the Federal Acquisition Regulation was amended to 

implement the executive order,23 federal agencies generally were waiting 

for USDA to publish a list before making any final decisions or 

modifications to their procurement programs. Whereas the executive 

order encouraged, but did not require, federal agencies to purchase 

biobased products, the farm bill generally requires that agencies give 

preference to these products. 

 21Executive Order 13101, § 504. 

22U.S. General Accounting Office, Federal Procurement: Better Guidance and Monitoring 

Needed to Assess Purchases of Environmentally Friendly Products, GAO-01-430

(Washington: D.C.: June 22, 2001). 

23The Federal Acquisition Regulation specifies rules that agencies must follow in their 

procurement actions. On June 6, 2000, the Civilian Agency Acquisition Council and the 

Defense Acquisition Regulations Council published a final rule amending the Federal 

Acquisition Regulation to implement Executive Order 13101. 65 Fed. Reg. 36016 (2000). 
Page 14 GAO-04-437 Biobased Products 

While USDA was faced with an ambitious task, its actions and 

consequently those of other agencies to implement the farm bill 

requirements for purchasing biobased products have been limited. USDA 

issued proposed guidelines in the Federal Register on December 19, 

2003,24 more than a year later than the farm bill requirement for final 

guidelines. These guidelines take only limited steps toward meeting the 

requirements of the farm bill. While the guidelines recommend some 

procurement practices and practices for vendor certification, they do not 

identify items designated for preferred procurement or provide 

information on their availability, relative price, performance, and 

environmental and public health benefits. Although USDA hopes to have 

some items designated before the end of calendar year 2004, the process 

for designating other items discussed in the preamble to the proposed 

guidelines will take years, possibly until 2010. In addition, as new biobased 

products are developed and enter the market, these items will also need to 

be designated. Regarding other biobased-related requirements of the farm 

bill, USDA has not yet developed a labeling or recognition program or 

completed its work on preferred procurement practices known as the 

model procurement program to guide both its own biobased purchases 

and those of other agencies. In the meantime, as the top four procuring 

agencies await USDA’s fulfillment of these requirements—particularly the 

designation of items for preferred procurement—they have taken only 

limited steps to procure biobased products. For example, some agencies 

are purchasing biobased cleaners, lubricants, deicers, and/or dining ware 

because these products are readily biodegradable and composted. 

USDA’s proposed guidelines only partially meet the requirements of the 

farm bill. While the guidelines recommend some procurement practices 

and practices for vendor certification, they do not identify items 

designated for preferred procurement or provide information on their 

availability, relative price, performance, and environmental and public 

health benefits. However, in the preamble to the guidelines, USDA 

discusses possible items for future designation. In the preamble, USDA has 

grouped these items by category, with each category consisting of one or 

more items and each item consisting of one or more branded biobased 

products. For example, “Lubricants and Functional Fluids” is one 

suggested category, hydraulic fluids is an item within that category subject 

 24Guidelines for Designating Biobased Products for Federal Procurement, 68 Fed. Reg. 

70730 (proposed Dec. 19, 2003). 

USDA Delay in 

Issuing Biobased 

Purchasing Guidelines 

Has Slowed Other 

Agencies’ Efforts 

USDA’s Initial Efforts Have 

Only Partially Met the 

Farm Bill Requirements 
Page 15 GAO-04-437 Biobased Products 

to designation, and “ABC Hydraulic Fluid” made by the ABC company is a 

branded biobased product related to that item. At present, the preamble 

discusses 11 categories of items and suggests a minimum biobased content 

for the items in these categories.25 Appendix III provides a complete list of 

these categories and the items listed under each, as well as additional 

information on provisions of the proposed guidelines. However, the 

proposed guidelines do not designate any items for preferred procurement 

given that USDA has not yet considered the availability of these items or 

the economic or technological feasibility, including life-cycle costs, of 

these items as required by the farm bill. 

Under the proposed rule, once an item is designated, manufacturers will 

be able to certify that their biobased products meet the characteristics of a 

designated item. USDA has established a biobased information Web site 

for this purpose. USDA anticipates that federal procuring agencies will use 

this Web site to obtain current information on designated items, contact 

information on manufacturers and vendors, and access to information on 

product characteristics relevant to procurement decisions. In addition, 

USDA anticipates that as the biobased product industry develops, new 

items and associated products will enter the market. Thus, new items will 

be designated, as necessary. 

In addition, USDA has only minimally provided information on 

recommended procurement practices pending completion of its model 

procurement program. For example, the proposed guidelines discuss the 

tests that should be used to establish the content, performance 

characteristics, and/or life-cycle costs of a product, including the 

standards or specifications applicable. However, USDA officials said the 

model procurement program, when complete, will contain considerably 

more guidance on recommended procurement practices. USDA expects to 

issue the final version of these proposed guidelines by April 2004, but it 

does not expect to have adequate information for designating more than a 

 25USDA groups the items discussed in the preamble in the following categories: (1) 

adhesives; (2) construction materials and composites; (3) fibers, paper, and packaging; (4) 

fuel additives; (5) landscaping materials, compost, and fertilizer; (6) lubricants and 

functional fluids; (7) plastics; (8) paints and coatings; (9) solvents and cleaners; (10) 

sorbents; and (11) plant and vegetable inks. According to the preamble, the items and the 

indicated biobased content of items contained within the categories are based on a study 

conducted in 2002 by the Concurrent Technologies Corporation for USDA’s Agricultural 

Research Service. 
Page 16 GAO-04-437 Biobased Products 

few items before the end of calendar year 2004.26 USDA estimates that it 

will complete the overall blueprint for a comprehensive, model 

procurement program by September 2004, and will have many of the 

specific components of the program under development or tested and 

implemented by that time. 

The process for designating items will be time consuming. For example, to 

designate the items discussed in the preamble to USDA’s proposed 

guidelines, USDA will likely initiate a number of rulemakings over a period 

of years. According to the timeline provided by New Uses staff, this 

process will likely not be completed until early 2010. USDA officials noted 

that these rulemakings may not correspond to the 11 product categories 

discussed in the preamble; the agency’s ability to move forward with 

designating individual items will depend on the availability of information 

needed for this purpose. As a result, a given rulemaking may address items 

that span two or more categories. For each rulemaking, a proposed rule 

would be developed and published first, followed by a 30- or 60-day 

comment period, the time needed to consider these comments, and then 

publication of the final rule. 

USDA must also complete its work on its recommended procurement 

practices (the model procurement program), the voluntary recognition 

program, and the voluntary labeling program. According to USDA officials, 

the model procurement program serves two purposes.27 First, it will 

constitute USDA’s biobased procurement program. All federal agencies, 

including USDA, are required to develop such a program. Second, the 

model program will serve as a guide to other agencies in developing their 

own preferred procurement programs.28 USDA officials explained that this 

 26In January 2004, USDA officials, including a New Uses official directly involved in the 

guidelines preparation, expressed doubt as to whether the agency can meet the anticipated 

issuance date—April 2004—for the final guidelines. These officials cited factors such as to 

the number and complexity of comments made on the proposed guidelines and the 

continued controversy and confusion as to what testing should be done for biobased 

products as reasons that may delay the final guidelines issuance. 

27As part of the model procurement program, USDA also plans to develop a framework for 

measuring the use of biobased products within USDA and for determining related benefits. 

This framework, if it is adopted by other procuring agencies, may provide a tracking 

mechanism for OFPP’s required biennial reports to Congress on agencies’ progress in 

purchasing biobased products. 

28According to the farm bill, agency procurement programs must contain, at a minimum, (1) 

a biobased products preference program, (2) an agency promotion program to promote this 

preference program, and (3) an annual review and monitoring of the effectiveness of the 

agency’s procurement program. 
Page 17 GAO-04-437 Biobased Products 

will fulfill the farm bill requirement placed on USDA to recommend 

procurement practices. USDA plans to incorporate the voluntary 

recognition program into its model procurement program. In addition, 

once the model procurement program is complete, USDA plans to seek a 

change to the Federal Acquisition Regulation to reflect these procurement 

practices. Changes to this regulation also require a rulemaking.29 Finally, 

USDA plans to address requirements for the labeling program in a future 

rulemaking. 

Considering the amount of work that remains to be done to fulfill the farm 

bill requirements, it seems likely that USDA’s fulfillment of these 

requirements will take years, particularly for the designation of items for 

preferred procurement that were discussed in the preamble of USDA’s 

proposed rule. Thus, although the farm bill required USDA to promulgate 

guidelines, including the designation of items for procurement, within 180 

days of the legislation’s enactment—by November 2002—it is not likely 

that the designation of all of the items discussed in the preamble to the 

proposed guidelines will be completed until the spring of 2010, according 

to USDA estimates. However, the agency hopes to have at least some of 

these items designated by the end of calendar year 2004. In addition, as the 

farm bill recognizes by allowing USDA to revise its guidelines from time to 

time, the process of designating items is a continual one as new biobased 

items will continue to enter the market. Appendix IV provides a timeline 

showing the chronology of steps USDA plans to fulfill the farm bill 

requirements for the federal procurement of biobased products. 

Without final USDA guidelines designating items for preferred 

procurement, the top four procuring agencies generally are reluctant to 

undertake an agencywide biobased procurement program. Officials from 

these agencies indicated that until they clearly understand whether a 

product meets USDA’s definition of a biobased product, it would not be 

advantageous to establish a purchasing program agencywide. However, 

even though these agencies have not implemented their own biobased 

procurement programs, we found that some of them have procured limited 

quantities of biobased products. For example: 

 29The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council 

publish rulemakings in the Federal Register amending the Federal Acquisition Regulation. 

Federal Agencies Have 

Procured Small Quantities 

of Biobased Products 
Page 18 GAO-04-437 Biobased Products 

• The Defense Logistics Agency (DLA)—the supplier for DOD and several 

civilian agencies—has procured and is now testing such biobased 

products as food service cutlery for service personnel overseas and 

hydraulic fluid for military helicopters. According to DLA officials, these 

products are appealing—assuming they meet necessary performance 

specifications—because they are readily biodegradable, which may make 

them easier to dispose of. These officials indicated that they are working 

closely with USDA to ensure that the products tested will ultimately be 

products that will meet USDA’s criteria for biobased products. However, 

these officials stated that their agency could test more products if USDA 

would publish guidance designating biobased products for purchase. 

Figure 2 shows wheat starch-based plastic cutlery that DLA is testing for 

field use. 

Figure 2: Biobased Cutlery 

• The Department of the Interior (Interior) purchases biobased products 

directly from manufacturers and has requested that their contractors use 

biobased products in some services. In an effort to promote the use of 
Page 19 GAO-04-437 Biobased Products 

biobased products in national parks, the National Park Service Facilities 

Management Division has covered the incremental costs for park 

purchases of biobased products over the use of traditional products; in 

2003, they provided $42,000 towards this promotion. For example, a 

wildlife reserve located in Alaska purchased a biobased deicer, made from 

corn and other agricultural products, to clear roads and sidewalks. Unlike 

deicers that rely on salt or petrochemicals, biobased deicers can be 

formulated to have less impact on surface waters and vegetation. Several 

national parks also are buying biobased fuels and additives for their 

snowmobiles because they produce less toxic emissions. In addition, 

biobased hydraulic oils are being used in construction equipment at many 

park sites because spills of these lubricants pose less environmental risk 

and are less costly to clean up. Furthermore, the cafeteria-service 

contractor in Interior’s headquarters building in Washington, D.C. uses 

biobased plates and bowls, made primarily of potato starch and limestone. 

A pilot project undertaken with USDA’s Beltsville Agricultural Research 

Center demonstrated the ability to compost the plates and bowls along 

with cafeteria food waste. Figure 3 shows the application of a biobased 

deicer by an Interior employee. Figure 4 shows other biobased products 

used by Interior. 

Figure 3: Application of a Biobased Deicer by Interior Employee 
Page 20 GAO-04-437 Biobased Products 

Figure 4: Display of Biobased Products Used by Interior 

• In addition to its research activities to develop new uses of agricultural 

commodities for producing biobased products,30 USDA’s Agricultural 

Research Service is taking steps to use biobased products as well. For 

example, the agency’s Beltsville Agricultural Research Center in Maryland 

(the Center) spent about $8,500 in fiscal year 2003 for biobased products—

primarily cleaners, hydraulic fluids, and lubricants used in its farm 

machinery. In addition, the Center uses biobased fuels, such as soy-based 

biodiesel, in this type of machinery. In fiscal year 2003, the Center 

purchased about $523,000 in biobased fuels. Center officials noted that the 

clean-up of accidental spills of biobased hydraulic fluids and lubricants is 

 30In fiscal year 2003, the Agricultural Research Service received appropriations of $19 

million for bioenergy research and $50 million for biobased products research. 
Page 21 GAO-04-437 Biobased Products 

far less expensive than the petrochemical alternatives because the 

biobased products are readily biodegradable.31 These officials also 

expressed their belief that maintenance costs for equipment using these 

products has dropped, compared with the costs associated with using 

petroleum-based alternatives, although they noted that they have not 

thoroughly studied and documented this anecdotal observation. According 

to these officials, the Center hopes to increase biobased purchases by 70 

percent in fiscal year 2004. In addition to the Center’s direct purchases of 

biobased products, some of its service contractors use biobased products 

when performing work at Beltsville. Center officials were unable to tell us 

how much their contractors spend on biobased products. Figure 5 shows 

some of the biobased products used at the Center. Figure 6 shows Center 

farm equipment in which biobased lubricants and fuels are used. 

 31According to a senior official in the Office of the Federal Environmental Executive, USDA 

has not coordinated with EPA regarding how spills of biobased hydraulic fluids and 

lubricants should be handled, including whether the clean up of these spills should be done 

any differently than spills of petroleum-based alternatives. The Director of EPA’s Oil Spill 

Staff confirmed in February 2004 that USDA had not contacted his office to discuss this 

matter. According to this official, EPA has not made a specific ruling regarding how spills 

of biobased hydraulic fluids and lubricants should be handled. However, absent such a 

ruling, EPA does not make a distinction between spills of these biobased products and 

their petroleum-based alternatives: both leave a sheen on top of water and must be cleaned 

up. 
Page 22 GAO-04-437 Biobased Products 

Figure 5: Biobased Cleaning Products Used at USDA’s Beltsville Agricultural 

Research Center 
Page 23 GAO-04-437 Biobased Products 

Figure 6: Tractor Run with Biobased Lubricants and Fuels at Beltsville Agricultural 

Research Center 
Page 24 GAO-04-437 Biobased Products 

USDA could more effectively marshal its resources to fulfill the farm bill 

biobased procurement requirements in a timely manner with a written, 

comprehensive management plan. Such a plan would define tasks and set 

milestones, identify available resources and expected outcomes, and 

describe how the department will coordinate its efforts to implement the 

plan. USDA did not have such a plan to guide its preparation of the 

proposed guidelines issued in December, and we believe that this lack of a 

plan may have contributed to delays in completing this segment of the 

work. Furthermore, except for the development of the model procurement 

program and voluntary recognition program, the agency does not have a 

comprehensive plan to guide its work to fulfill the farm bill’s other 

biobased requirements. Finally, USDA’s implementation of the biobased 

provisions could be accelerated if the department assigned more staff and 

financial resources to this work and gave it a higher priority. 

USDA assigned primary responsibility for implementing the farm bill 

biobased procurement provisions to its Office of Energy Policy and New 

Uses (New Uses office), located within the Office of the Chief Economist. 

The conference report for the farm bill encouraged USDA to carry out 

these provisions under the aegis of the New Uses office. Among other 

things, this office is responsible for developing the procurement 

guidelines, including designating items for procurement, recommending 

practices for procurement and for certification by vendors of the 

percentage of biobased content in their products, and providing 

information on the availability, relative price, performance, and 

environmental and public health benefits of the items designated. The New 

Uses office also is primarily responsible for establishing the voluntary 

labeling program. In addition, USDA charged its Office of Procurement 

and Property Management (Procurement office) with developing the 

model procurement program and the voluntary recognition program. 

When we asked New Uses officials in May 2003—a year after farm bill 

enactment and 6 months after the legislation deadline for USDA’s 

completion of the biobased procurement guidelines—for their written 

management plan to implement the farm bill requirements, they indicated 

that they did not have a plan. At our request for the agency’s timeline for 

complying with these requirements, these officials indicated that they did 

not have a timeline either, but offered to create one, which they provided 

to us several weeks later in June 2003. 

USDA Could 

Accelerate 

Implementation of the 

Biobased 

Procurement Program 

by Developing a 

Comprehensive 

Management Plan and 

Assigning Adequate 

Resources 

Need for Better Planning 

and Coordination 
Page 25 GAO-04-437 Biobased Products 

While the timeline is a start, it falls short of being a comprehensive plan in 

a number of respects. First, the timeline provides for delays in meeting 

milestones, stating “this is an optimistic schedule; various delays could 

push this date [for the proposed guidelines] back as much as 6 months or 

more, which would similarly push back all following milestones.” Indeed, 

there have been delays. For example, the timeline states that the proposed 

guidelines will be published in the Federal Register on October 1, 2003, 

but they were not published until December 19, 2003. According to USDA 

officials, additional delays, not anticipated in the timeline, could postpone 

some of the expected completion dates by as much as a year. These 

officials noted that these delays may result from the difficulty of working 

through the various concerns and conflicting views of the many 

stakeholders to this effort, a process that one New Uses official said was 

akin to “swimming in molasses.” A comprehensive plan would discuss 

possible sources of delay and how they might be mitigated. 

Second, New Uses staff developed the timeline without consulting with 

the USDA office responsible for developing the model procurement 

program and the voluntary recognition program—the Procurement office. 

When we met with officials from the Procurement office in September 

2003, they said that they had not seen the timeline we received from the 

New Uses office in June 2003. When we showed these officials the 

timeline, they indicated disagreement with some of the dates related to 

their portion of the work. A comprehensive plan would discuss how the 

work should be coordinated among interested offices to avoid these types 

of misunderstandings. 

Third, the timeline does not describe how coordination will be done with 

other interested agencies. The farm bill requires that USDA consult with 

EPA, GSA, and NIST before developing the procurement guidelines. The 

legislation also requires USDA to consult with EPA in establishing the 

voluntary labeling program. As a practical matter, it would also be 

important for USDA to coordinate with the top four procuring agencies—

DOD, DOE, NASA, and GSA—-as well as other agencies such as the Office 

of the Federal Environmental Executive. During our work, we contacted 

relevant officials representing these agencies; most expressed concern 

about what they considered to be a lack of timely and effective 

coordination on USDA’s part, although officials from some of the agencies 

seemed generally satisfied. Some of those who expressed concerns about 

coordination noted that USDA had been more attentive, relatively 

speaking, to interagency consultation in its earlier efforts to develop a list 

of biobased products for procurement under the 1998 executive order. In 

addition, a senior official of the Office of the Federal Environmental 
Page 26 GAO-04-437 Biobased Products 

Executive said that USDA has not effectively coordinated with EPA and 

DOE officials responsible for programs that promote government 

purchases of environmentally friendly, recycled content, or energy 

efficient products. Specifically, this official noted that USDA does not have 

a clear understanding of how its biobased guidelines will impact 

regulations related to these other programs. In addition, this official 

opined that USDA is missing the opportunity to incorporate the lessons 

learned from the development of these other programs. In light of these 

concerns, during our work we asked the New Uses staff for minutes or 

other written documentation of coordination meetings. These staff 

indicated that they had not documented internal or external coordination 

meetings in writing.32 A comprehensive plan would identify agencies with 

which coordination should occur, describe the frequency and manner of 

these contacts, and indicate how the results of these meetings would be 

documented. 

Fourth, the timeline does not describe how progress reporting will be 

done, what form these reports will take, or to whom these reports will be 

made. New Uses officials told us that although they do not prepare regular 

progress reports, they do discuss the status of their work on the farm bill 

biobased provisions at weekly staff meetings with the Chief Economist 

and that this official periodically briefs the Secretary of Agriculture.33 In 

addition, these officials indicated that the status of their work is reported 

weekly to USDA’s farm bill implementation team and that this team also 

reports to agency’s subcabinet officers. However, without a 

comprehensive management plan, including clearly delineated tasks and 

associated milestones, we believe it would be difficult for managers to put 

into context the relative progress being made on this work, to identify 

needed adjustments, and to hold accountable the officials responsible for 

its completion. A comprehensive plan would describe who the officials 

responsible for implementing the farm bill requirements would report to 

and the frequency and manner of periodic progress reports. 

In contrast to the New Uses office’s lack of a management plan, the 

Procurement office prepared a detailed written management plan for 

 32At a meeting with USDA staff in February 2004, a New Uses official indicated that if given 

time, he could probably find examples of old e-mails discussing coordination meetings. 

However, we noted that we had requested written documentation of these meetings during 

our work and that this official said these meetings were not documented in writing. 

33The New Uses office is placed organizationally under the Office of the Chief Economist. 
Page 27 GAO-04-437 Biobased Products 

conducting its portion of the work.34 This document contains the elements 

of a comprehensive plan, including identifying the work to be done, the 

associated tasks and milestones, available resources, anticipated costs, 

and the type and frequency of progress reporting. The plan also discusses 

the need for coordination with other USDA offices and federal agencies 

and how this coordination will be accomplished. Unfortunately, however, 

this plan applies only to limited aspects of the work USDA must complete 

to fulfill the farm bill requirements. The New Uses office is responsible for 

the majority of the work needed to fulfill these requirements; yet, as 

discussed, it lacks a comprehensive plan for completing this work. 

We met with USDA officials, including New Uses staff, in February 2004 to 

discuss further the lack of a comprehensive management plan and other 

issues identified in our work and their significance. At that meeting, the 

New Uses staff provided us a document entitled, “Implementing Section 

9002 of the Farm Bill.” This document was attached to an e-mail dated 

June 2002 that referred to the attachment as an “early draft 

implementation plan for Section 9002.” New Uses staff indicated that this 

document was evidence of their planning. However, our analysis of this 

document reveals that it is not a comprehensive management plan for 

implementing the farm bill requirements. First, the e-mail refers to the 

document as an early draft; apparently it never advanced beyond this 

stage. Second, the document lacks most elements of a comprehensive 

plan, such as a description of specific tasks, associated milestones, and the 

frequency, manner, and documentation of coordination meetings and 

periodic progress reporting.35 Instead, the document generally restates the 

farm bill requirements and the related conference report language, 

discusses some options for addressing these requirements, and presents a 

rationale for hiring a contractor with the requisite skills to implement the 

farm bill provisions under the management oversight of the New Uses 

office. Interestingly, although a contractor was not hired,36 the document 

 34Management Plan for Design, Development and Deployment of USDA’s Federal 

Biobased Product Preferred Procurement Program, January 9, 2004. 

35In general, a comprehensive plan also would discuss the goals or expected outcomes of 

an initiative. In this case, the farm bill makes clear these goals or outcomes: recommend 

procurement practices, designate items for procurement, and establish programs for 

labeling and recognition. 

36While USDA did not hire a consulting firm to implement the biobased provisions under 

the New Uses office’s direction, it used funds authorized by the farm bill for testing to enter 

into cooperative agreements with two testing organizations to develop testing guidance and 

an information Web site for biobased products. 
Page 28 GAO-04-437 Biobased Products 

notes that, “Contractor performance would be evaluated on an annual 

basis against pre-agreed-upon achievement milestones, with an 

opportunity to re-direct resources if necessary.” Thus, although the New 

Uses office apparently planned to use a list of specific tasks and 

associated milestones to judge the contractor’s progress and hold this firm 

accountable, the New Uses staff, who had to undertake this work without 

contractor assistance, did not develop a similar list of tasks and milestones 

to guide their work. As discussed, New Uses staff did not develop a list of 

milestones until the spring of 2003, and only at our request. 

Furthermore, at our February 2004 meeting, USDA officials expressed the 

view that although they had missed the farm bill biobased-related 

deadlines and most farm bill biobased procurement requirements remain 

unfulfilled, they had made noteworthy progress in publishing the proposed 

guidelines in December 2003. These officials discussed and subsequently 

provided us with a document listing work activities they had undertaken 

leading up to the publication of these guidelines. Among other things, the 

list notes that during the summer and fall of 2002, USDA developed the 

aforementioned “implementation plan,” held various internal meetings and 

external consultations, and began drafting the guidelines. Thereafter and 

throughout calendar year 2003, the list primarily shows that USDA went 

through several rounds of vetting and revising the guidelines, based on 

reviews done by the OMB and USDA’s Office of General Counsel. In 

addition, USDA officials noted that throughout this process their collective 

thinking evolved as to the form and content of the guidelines and included 

considerations such as (1) whether the list of biobased products that was 

being developed by the agency under the 1998 executive order had 

relevance in light of farm bill criteria for designating items and (2) whether 

a more simplified, less-burdensome approach regarding the content of the 

guidelines would still satisfy the legislation’s requirements. Finally, New 

Uses officials stated that the notice of proposed rulemaking containing the 

proposed guidelines was developed far more quickly—by a measure of 

years—than the rulemakings for two other programs that they view as 

relevant: the preferred procurement program for recycled products 

developed by EPA and the organic product labeling program developed by 

USDA. 

In citing the lack of a management plan, we are not questioning whether 

New Uses staff have worked hard or whether the complexity and novelty 

of the issues they faced were challenging. Rather we are raising the 

question of whether the efficiency of this work has suffered because of a 

lack of a comprehensive plan to guide it. Clearly, the other USDA office 

involved in implementing the farm bill biobased requirements thought it 
Page 29 GAO-04-437 Biobased Products 

was important to develop a thorough management plan to guide its portion 

of the work to ensure the efficient use of available resources and timely 

completion of the work. Furthermore, we are unable to comment on the 

relevance of comparing the development of various rulemakings cited by 

New Uses staff because such an analysis is outside the scope of our work. 

However, we believe there are probably lessons to be learned from EPA’s 

experience in developing the procurement program for recycled products 

that would benefit USDA’s efforts to develop a similar program for 

biobased products. 

Careful planning for a major initiative is a recognized good business 

practice. Furthermore, the need for adequate planning in federal programs 

is established in legislation such as the Government Performance and 

Results Act of 1993,37 Presidential executive orders, circulars of OMB, and 

agency regulations to ensure that federal program managers know what 

they want to accomplish, how they are going to accomplish it, and when it 

will be accomplished. Without a comprehensive plan for implementing the 

farm bill requirements assigned to the New Uses office, including clearly 

defined tasks and milestones, it is difficult for USDA to set priorities, use 

resources efficiently, measure progress, and provide agency management 

a means to monitor this progress. Furthermore, the lack of a plan only 

serves to delay the agency’s completion of legislatively required actions. 

USDA did not allocate the staff needed to expedite the biobased 

procurement effort. It assigned responsibility for this effort to two staff in 

the New Uses office who also had other responsibilities—in effect, they 

worked part-time on biobased procurement. While these New Uses 

officials had assistance from time-to-time from staff in other USDA offices, 

including staff who had been involved in the agency’s earlier efforts under 

the executive order, the availability of these staff was more ad hoc, subject 

to the demands of other work to which they were assigned. In addition, 

according to these New Uses officials, no one in their office had 

experience in writing rules; and they had to wait several months before 

staff from another office with this experience could be assigned to help 

write the notice of proposed rulemaking containing the guidelines for 

publication in the Federal Register.

38 However, New Uses officials said 

that while they were waiting for this assistance, they were able to continue 

 37Pub. L. No. 103-62, 107 Stat. 285 (1993). 

38Staff from USDA’s Animal and Plant Health Inspection Service provided this assistance. 

Need for Additional 

Resources 
Page 30 GAO-04-437 Biobased Products 

with other aspects of the work. Nevertheless, although these New Uses 

officials stated that they do not believe that the guidelines could have been 

issued in any case by the farm bill deadline, they believe that the lack of 

adequate personnel assigned specifically to this effort was a source of 

delay. 

Regarding funding, the farm bill did not specifically authorize any funds 

for developing the biobased procurement guidelines, and USDA did not 

provide any funds to the New Uses office for this effort from other 

programs. In essence, the New Uses office had to absorb these costs from 

its operating budget; and as a result, this office assigned only two staff to 

work part-time on meeting the farm bill requirements, as discussed.39 The 

New Uses office began its work soon after passage of the farm bill. 

However, the farm bill authorized $1 million annually for testing biobased 

products. To date, the New Uses office has used these funds to contract 

with Iowa State University and NIST to develop testing protocols for 

biobased products and an information Web site on biobased products. 

Regarding development of a model procurement program and the 

voluntary recognition program, the Procurement office did not begin this 

work until the fall of 2003 because of a lack of identified funding for this 

purpose until that time. Specifically, in September 2003, USDA’s Rural 

Development Mission Area transferred about $500,000 to the Procurement 

office for this purpose. In addition, the Procurement office added about 

$25,000 of its own funds to this sum. This office used these funds to 

contract with the DOE’s Oak Ridge National Laboratory and a consulting 

firm to, among other things, assist in developing the office’s 

comprehensive plan for implementing this portion of the work. Oak Ridge 

also will be involved in the plan’s implementation under the Procurement 

office’s direction. In addition, USDA transferred a staff member from its 

Office of Small and Disadvantaged Business Utilization to the 

Procurement office to oversee this effort. While Procurement office staff 

indicated that the funds identified to date should carry them through the 

 39According to USDA’s Office of Budget and Program Analysis and relevant documents, the 

President’s budget proposals for USDA for fiscal years 2003 and 2004 did not request funds 

specifically for developing the biobased procurement guidelines. However, the President’s 

budget proposal for USDA for fiscal year 2005 seeks, among other things, an increase of 

$2.5 million to be used for the biobased procurement program. Specifically, these funds are 

to be used to designate specific groupings of biobased products for procurement by federal 

agencies, establish and maintain a products database, develop a product labeling system, 

and allow for the continued operation and maintenance of the procurement program, once 

established, on a governmentwide basis. 
Page 31 GAO-04-437 Biobased Products 

end of fiscal year 2004, they said additional funding will be needed in the 

future to continue their work on the model procurement program. For 

example, the staff member who oversees this effort estimated that about 

$450,000 will be needed in fiscal year 2005 and about $500,000 will be 

needed in fiscal year 2006. 

According to USDA staff who worked on developing a biobased products 

list under the 1998 executive order, assigning responsibility for developing 

the farm bill biobased procurement guidelines to the New Uses office 

should have given this effort more agency attention because this office 

reports to the Chief Economist who in turn reports directly to the 

Secretary of Agriculture. Previously, work on developing a list of biobased 

products was split among several line agencies and offices, including the 

Agricultural Research Service, the Cooperative State Research, Education, 

and Extension Service, and the Procurement office, that do not enjoy this 

direct access to the Secretary. However, despite this expectation of 

greater agency attention, USDA has made limited progress in fulfilling the 

farm bill requirements; and several USDA officials indicated that this work 

is not a high priority, relative to other agency initiatives. In addition, 

stakeholders outside of USDA also believe that the agency has not given 

sufficient management attention to the fulfillment of the farm bill biobased 

provisions. For example, representatives of commodity associations and 

manufacturers stated that although they had hoped for timely and effective 

procurement guidelines from USDA, the issuance of guidelines has been 

delayed because this effort is not a priority for the agency. 

In our earlier work, related to USDA’s implementation of the 1998 

executive order,40 USDA officials indicated that they had made limited 

progress in publishing a list of biobased products for procurement 

because of a lack of dedicated resources and higher agency priorities. 

Although USDA’s issuance of federal procurement guidelines for biobased 

products, as well as USDA’s establishment of a voluntary labeling program 

and voluntary recognition program, is now legislatively required, this work 

still suffers from a lack of adequate resources and management attention. 

 40U.S. General Accounting Office, Federal Procurement: Better Guidance and Monitoring 

Needed to Assess Purchases of Environmentally Friendly Products, GAO-01-430

(Washington, D.C.: June 22, 2001). 

Need for Assigning a 

Higher Priority 
Page 32 GAO-04-437 Biobased Products 

Most federal agencies, testing organizations, commodity associations, and 

manufacturers we spoke with generally believe that testing biobased 

products for content and performance is appropriate, but they question 

the usefulness and costs of life-cycle analysis. According to officials from 

the top four purchasing agencies and the two testing organizations, 

content testing is important to ensure that products meet minimum 

biobased content specifications, and performance testing is a key factor in 

making purchasing decisions. These officials generally believe that 

manufacturers should bear the costs of these tests, if they want to sell to 

the federal government. Biobased manufacturers generally agree with the 

need for these tests and with their responsibility for bearing at least some 

of the associated costs. However, some manufacturers said that they 

should be able to self-certify the biobased content of their products in lieu 

of content testing, based on their knowledge of their manufacturing 

processes. Regarding life-cycle analysis, most of the agencies and 

manufacturers questioned the need for doing this analysis. USDA is 

required to consider life-cycle costs in determining whether to designate 

an item for preferred procurement and has indicated that if manufacturers 

voluntarily provide life-cycle cost information it may help speed the 

designation process. Manufacturers would only be required to provide this 

information under the rule as proposed if a procurement official requested 

the information.41 However, the agencies generally did not believe that lifecycle information would be useful for purchasing decisions because 

procurement staff would find the analysis too detailed to follow and 

generally not useful without comparative information on petroleum-based 

products; USDA does not expect to provide such comparative information. 

Manufacturers generally agreed with this view, noting that the cost of lifecycle analysis is high—as much as $8,000 for a single product—and they 

questioned whether they alone should bear this cost in order to make sales 

to the federal government. 

The farm bill authorized USDA to use $1 million per year of the 

Commodity Credit Corporation’s funds from fiscal year 2002 through fiscal 

year 2007 for testing of biobased products. Initially, as discussed in its 

proposed guidelines, USDA plans to use these funds to focus on gathering 

the necessary test information on a sufficient number of products within 

an item (generic grouping of products) to support regulations to be 

 41According to the preamble to USDA’s proposed guidelines, USDA is considering requiring 

the analysis of the life-cycle costs and health benefits of a product in order for the product 

to qualify for use of the “U.S.D.A. Certified Biobased Product” label. 

Stakeholders 

Generally Agree That 

Some Testing of 

Biobased Products Is 

Necessary, but They 

Question the Need 

For Life-Cycle 

Analysis 
Page 33 GAO-04-437 Biobased Products 

promulgated to designate an item or items for preferred procurement. 

However, the farm bill also allows that these funds may be used to support 

contracts or cooperative agreements with entities that have experience 

and special skills to conduct such testing. The $1 million for fiscal year 

2002 was used for agreements with testing organizations to establish 

standardized tests for determining the biobased content and life-cycle 

analysis characteristics of biobased products. Part of this money also was 

used to develop a biobased products information Web site. USDA views 

the establishment of this Web site as integral to fulfilling the farm bill 

requirement for providing information on products. USDA is using the $1 

million for fiscal year 2003 to evaluate selected products using the 

standardized tests to establish benchmarks for designating items for 

preferred procurement. The agency is also using some of this money to 

complete and maintain the information Web site. USDA anticipates that $1 

million for fiscal year 2004 will be used to cost-share with manufacturers 

some of the expenses associated with testing products in order to develop 

the information needed to designate items for preferred procurement. 

In general, USDA plans to bear the cost of any testing that may be needed 

to establish baseline information for designating items. Regarding this 

testing, in its proposed guidelines USDA indicates that it may accept cost 

sharing from manufacturers or vendors for this testing to the extent 

consistent with USDA product testing decisions. However, during this 

period, USDA will not consider cost sharing in deciding what products to 

test. When USDA has concluded that a critical mass of items has been 

designated, USDA will exercise its discretion, in accordance with 

competitive procedures outlined in the proposed guidelines, to allocate a 

portion of the available USDA testing funds to give priority to testing 

products for which private firms provide cost sharing for the testing. At 

that point, cost-sharing proposals would be considered first for small and 

emerging private business enterprises.42 If funds remain to support further 

testing, proposals from larger firms would also be considered. 

USDA’s proposed guidelines would require manufacturers and vendors to 

provide relevant product characteristics information to federal procuring 

agencies on request. For example, under the proposed guidelines, 

manufacturers would have to be able to verify the biobased content of 

 42As defined in USDA’s proposed guidelines, small and emerging private business 

enterprises include any private business that employs 50 or fewer employees and has less 

than $1 million in projected annual gross revenues. 
Page 34 GAO-04-437 Biobased Products 

their products using a specified standard. In addition, federal agencies 

would have to rely on third-party test results showing the product’s 

performance against government or industry standards. Furthermore, 

manufacturers would have to use NIST’s Building for Environmental and 

Economic Sustainability (BEES) analytical tool to provide information on 

life-cycle costs and environmental and health benefits to federal agencies, 

when asked. USDA recommends that federal agencies affirmatively seek 

this information. 

According to officials we contacted from the top four purchasing agencies 

and the two testing organizations—Iowa State University and NIST—

content and performance testing are necessary to help federal agencies 

make purchasing decisions. Content testing is necessary to ensure that 

products meet the biobased content specifications for designated items.43

Furthermore, the results of performance testing are a key consideration, 

along with product availability and price, for federal procurement officials 

when selecting a product for purchase, whether the product is biobased or 

not.44 These agency and testing organization officials also believe that 

manufacturers should bear the costs of content and performance testing 

because these tests are considered normal business costs associated with 

marketing products. 

Ten of the 15 biobased manufacturers we contacted agree that content and 

performance testing are necessary. Two other manufacturers agreed that 

one of these tests was necessary, but they did not agree on which test. 

Most of these manufacturers also acknowledged their responsibility for 

bearing at least some of the costs for these tests. However, some of the 

manufacturers believe that they should self-certify content, based on their 

knowledge of their manufacturing process, including the feedstock used. 

These manufacturers suggested that USDA could conduct random content 

 43Content is determined by doing carbon testing. This testing, done by an accredited 

laboratory, is able to differentiate between “new” carbon derived from plant materials 

(carbohydrates) and “old” carbon derived from fossil resources (hydrocarbons). The 

biobased content is determined by the amount of carbon derived from plant materials. 

44Performance testing, done by accredited testing organizations, assesses a product’s 

performance against standards provided by the American Society for Testing and Materials; 

the International Standards Organization; Federal civilian or military specifications; or 

other industry sources. For example, such testing may be done on a biobased engine or 

gear oil to determine if it meets relevant standards for lubricity under a variety of potential 

operating conditions, including extreme heat or cold. 

Most Stakeholders Agree 

that Content and 

Performance Testing Are 

Necessary 
Page 35 GAO-04-437 Biobased Products 

testing to verify these certifications. Similarly, representatives from the 

Biobased Manufacturers Association stated that they believe, based on 

input from their member companies, that manufacturers should selfcertify the content of their products. These association officials suggested 

that content testing should only be required when there is a challenge to 

these certifications. Most of the manufacturers believed that the 

requirement for providing performance testing information is reasonable 

and that, because the cost of this testing is an expected cost of doing 

business, they should bear this expense. 

Officials representing the top four procurement agencies, manufacturing 

companies, the Biobased Manufacturers Association, and commodity 

associations generally questioned the need for life-cycle analysis of 

biobased products.45 Under USDA’s proposed guidelines, manufacturers 

are invited to voluntarily submit their product to a life-cycle analysis using 

the BEES analytical tool developed by NIST, so that USDA can obtain 

information it is required to consider in designating items for preferred 

procurement. However, once an item has been designated, the 

manufacturer would have to provide information on life-cycle costs, if 

asked to do so by a procuring agency, using BEES for their particular 

product. While some manufacturers indicated that they do not object to 

performing life-cycle analysis per se, and a few even indicated that they 

have done such an analysis already to use the results in marketing their 

product(s), these stakeholders questioned USDA’s decision to rely solely 

 45A life-cycle analysis (or assessment) of a product includes a “cradle to grave” examination 

of the product’s economic and environmental performance. Regarding economic 

performance, the costs of initial investment, replacement, operation, maintenance and 

repair, and disposal are generally included. Regarding environmental performance, the 

environmental and public health impacts of all stages in a product’s life are usually 

examined, including raw material acquisition, manufacture, transportation, installation, 

use, and recycling and waste management. 

Stakeholders Generally 

Question the Need for LifeCycle Analysis 
Page 36 GAO-04-437 Biobased Products 

on one analytical tool—BEES—to perform this analysis.46 Other 

stakeholders pointed out that any life-cycle analysis results for biobased 

products would be of limited usefulness without comparable results for 

similar products that are petroleum based. 

Stakeholders voiced the following opinions regarding whether life-cycle 

analysis results are, in general, useful and/or whether USDA should rely 

solely on the BEES analytic tool for doing this analysis: 

• Many of the officials representing manufacturers and commodity 

associations believe that federal purchasers will not find life-cycle analysis 

results for biobased products to be useful unless they have comparable 

results for competing petroleum-based products. For example, if federal 

purchasing officials have information on the economic and environmental 

impacts of a biobased product, but do not have similar information for its 

petroleum-based alternative, these officials will not be able to determine if 

the higher initial purchase cost of the biobased product is offset by its 

lower maintenance and disposal costs and/or lower environmental 

impacts. Even officials from USDA and the testing organizations 

acknowledged that the usefulness of BEES results for biobased products 

would be greater if similar results were available for petroleum-based 

alternatives. These officials said that although the farm bill does not 

address life-cycle analysis for petroleum-based products, they hope that 

manufacturers of these products will submit them to BEES analysis 

voluntarily so that comparable data are available. However, other 

stakeholders questioned why a manufacturer of a petroleum-based 

product would incur this expense voluntarily, especially if the BEES 

results could cast the manufacturer’s product in an unfavorable light. 

USDA officials added that procuring agencies could, if they choose, also 

require manufacturers of petroleum-based products to provide this 

 46BEES is an analytic software tool for performing life-cycle analysis that was developed by 

NIST. Its initial application was for the evaluation of building products. BEES relies on 

standards promulgated by the American Society for Testing and Materials for determining 

economic impacts and by the International Standards Organization for determining 

environmental impacts. Economic impacts are expressed as total dollar costs and 

environmental impacts are indicated as an aggregate environmental performance score. 

BEES can be used to determine trade-offs between competing products. For example, 

BEES can be used to demonstrate that a short-lived, low initial-cost product is often not 

the cost-effective alternative. Instead, the purchase of a higher initial cost product may be 

justified if it is more durable and maintenance-free and less costly to dispose. Recently, 

under contract with USDA, NIST adapted BEES to perform life-cycle analysis on biobased 

products. For example, NIST has updated its database to include performance data for 

eight major biomass inputs used in manufacturing biobased products: soybeans, corn, 

wheat, rice, cotton, canola, potatoes, and wool. 
Page 37 GAO-04-437 Biobased Products 

information in order to make sales to the agencies, but other stakeholders 

opined that the agencies are not likely to do so because they do not now 

seek this type of information. USDA officials also noted that to ensure a 

level playing field it is important that manufacturers and vendors use the 

same life-cycle analysis tool to ensure consistent and comparable results. 

• Many manufacturer and commodity association officials stated that the 

cost of the life-cycle analysis was too expensive for most small 

manufacturers to bear. According to NIST, the cost of testing a product 

using the BEES analytic tool is about $8,000. The cost of subsequent 

testing of related products from the same manufacturer is about $4,000 per 

product tested. For small manufacturers with fewer than 500 employees, 

the cost of testing is $4,000 for the first product and $2,000 for each 

additional product, assuming similar processing steps and the continued 

availability of federal cost-share assistance.47 Some USDA officials 

expressed the view that these costs are not exorbitant, adding that the 

costs of content testing is even cheaper, falling in the range of a few 

hundred dollars. 

• Federal procurement officials indicated that life-cycle analysis is generally 

not an important factor in procurement decisions. A product’s price, 

availability when needed, and ability to meet performance specifications 

are the most important considerations, according to these officials. In 

addition, a number of manufacturer and commodity association 

stakeholders questioned whether procurement officials would even 

understand the significance of the results of a life-cycle analysis. However, 

USDA officials noted that the impetus to purchase biobased products also 

should come from the agency program officials who generate the 

requirements for the goods and supplies that procurement staff purchase. 

With this in mind, the Procurement office’s plan for developing the model 

procurement program includes major tasks related to training and 

outreach to groups other than just the procurement staff. If these other 

groups who generate the purchase requirements also understand the 

potential benefits of biobased products and the legislative requirements 

for giving these products preference in federal purchasing, then they may 

stipulate in their purchase requests that procurement staff buy biobased 

alternatives. Similarly, these groups may stipulate in service contracts that 

firms purchase and use biobased products. 

 47According to USDA’s proposed guidelines, the agency could provide up to 50 percent of 

the cost of testing a small manufacturer’s product using BEES. 
Page 38 GAO-04-437 Biobased Products 

• Some manufacturers, citing the detailed nature of the BEES analysis, 

expressed concerns that trade secrets related to their product could be 

compromised. However, according to a NIST official primarily responsible 

for adapting the BEES analytic tool for evaluating biobased products, the 

information submitted for BEES analysis will not be subject to Freedom of 

Information Act requests. This official also indicated that contracts made 

with third-party testing organizations for conducting BEES analysis will 

include language imposing penalties for improperly divulging product 

information. In addition, this official said that life-cycle information 

generated for designating items through the testing of branded products 

will be aggregated in such a way so as not to reveal the “recipe” (contents 

and structure) of a given product. 

USDA has yet to fulfill many of the farm bill biobased procurement 

requirements. Among other things, USDA has not issued final procurement 

guidelines that designate items for preferred procurement. USDA’s work 

has been slowed by the lack of a comprehensive management plan 

outlining the tasks, milestones, resources, coordination, and reporting 

needed for its completion. In addition, USDA has not assigned sufficient 

staff and financial resources or given sufficient priority to this effort to 

ensure its timely completion. Because other federal agencies’ procurement 

of biobased products largely hinges on USDA’s fulfillment of these farm 

bill requirements, USDA action is critical. 

To ensure USDA’s timely implementation of the farm bill biobased 

purchasing requirements, we recommend that the Secretary of Agriculture 

carry out the following three recommendations: 

• Direct the Office of Energy Policy and New Uses to develop and execute a 

comprehensive management plan for completing this work. Among other 

things, such a plan should discuss the tasks, milestones, resources, 

coordination, and reporting needed for completing this work. 

• Clearly identify and allocate the staff and financial resources to be made 

available for completing this work. 

• Clearly state the priority to be assigned to this work. 

Conclusions 

Recommendations 
Page 39 GAO-04-437 Biobased Products 

We provided a draft of this report to USDA for review and comment. We 

received written comments from the agency’s Chief Economist, which are 

presented in appendix V. USDA also provided us with suggested technical 

corrections, which we have incorporated into this report as appropriate. 

USDA indicated that it believes the report does not present a complete and 

balanced view of the progress it has made in implementing the farm bill 

biobased procurement provisions. Specifically, USDA said that the report 

emphasizes negative interpretations without reflecting the very 

considerable progress achieved, or how favorably that progress compares 

with other government efforts to develop preference programs, such as 

the EPA’s program for the purchase of recycled products. We believe the 

report provides a fair and accurate description of the farm bill 

requirements and USDA’s efforts to comply with these requirements to 

date. The scope of our work did not include a comparison of USDA’s 

efforts to implement these requirements to the efforts of other agencies to 

implement other procurement preference programs. However, we have 

previously reported on EPA’s efforts to implement legislative requirements 

for the purchase of recycled products, and in doing so we raised issues 

similar to those we are raising with USDA in this report.48 Namely, we 

reported that EPA lacked a comprehensive, written strategy for 

completing the work and had not given the work adequate staffing and 

resources and priority. 

Regarding our recommendation that the New Uses office develop and 

execute a comprehensive management plan for completing the work 

needed to fulfill the farm bill biobased purchasing requirements, USDA 

indicated disagreement. Specifically, USDA said it does not believe such a 

plan would have accelerated its work on the proposed rule issued in 

December 2003, given the complexity of the issues that had to be resolved 

and the substantial amount of consultation across federal agencies and 

within USDA that was a necessary component of developing this rule. We 

disagree and continue to believe that USDA should develop a 

comprehensive, written plan that discusses, among other things, the tasks, 

milestones, resources, coordination, and reporting needed for completing 

the work necessary to fulfill the farm bill requirements. Such a plan would 

also serve as a basis for communicating USDA’s progress with the 

Congress and others, including the department’s senior management. 

 48U.S. General Accounting Office, Solid Waste: Federal Program to Buy Products With 

Recovered Materials Proceeds Slowly, GAO/RCED-93-58 (Washington, D.C.: May 17, 1993). 

Agency Comments 

and Our Evaluation 
Page 40 GAO-04-437 Biobased Products 

Furthermore, we believe that factors such as the complexity and breadth 

of the issues to be considered, the internal and external consultation 

necessary, and the farm bill’s ambitious time frames for the completion of 

this work underscore the need for a comprehensive, written plan or 

strategy for the completion of this work. Finally, we note that another 

USDA office, the Office of Procurement and Property Management, 

developed a comprehensive, written plan for the completion of its limited 

portion of the biobased work. Among other things, this plan discusses the 

need for consultation, identifies the internal and external stakeholders to 

consult with, and enumerates specific tasks related to this consultation. 

Regarding our recommendations that USDA clearly identify and allocate 

the staff and financial resources to be made available for implementing the 

farm bill biobased purchasing requirements and clearly state the priority 

to be assigned to this work, USDA did not address these recommendations 

directly. However, USDA said that it would draw on GAO’s review and 

recommendations as it approaches the development of subsequent 

proposed rules for designating items and for development of the labeling 

program. We believe that USDA should be more proactive in this regard 

and make clear the staff and financial resources to be made available for 

completing this work and the priority to be assigned to this work. These 

matters could also be addressed in a comprehensive, written plan or 

strategy for completing the work. 

We also obtained comments from the DLA, DOE, Interior, EPA, GSA, 

NASA, NIST, and the Office of the Federal Environmental Executive on 

excerpts of the report that were relevant to their agencies. Their clarifying 

comments were incorporated into this report, as appropriate. 

As agreed with your office, unless you publicly announce its contents 

earlier, we plan no further distribution of this report until 30 days from the 

date of this letter. We will then send copies to interested congressional 

committees; the Secretary of Agriculture; the Secretary of Energy; the 

Director, OMB; and other interested parties. We will make copies available 

to others on request. In addition, the report will be available at no charge 

on GAO’s Web site at http://www.gao.gov. 
Page 41 GAO-04-437 Biobased Products 

If you have any questions about this report, please contact me at (202) 512-

3841. Key contributors to this report are listed in appendix VI. 

Sincerely yours, 

Lawrence J. Dyckman 

Director, Natural Resources 

 and Environment 
Appendix I: Objectives, Scope, and 

Methodology 

Page 42 GAO-04-437 Biobased Products 

At the request of the Ranking Democratic Member of the Senate 

Committee on Agriculture, Nutrition, and Forestry, we reviewed issues 

related to the federal government’s progress in implementing the biobased 

purchasing provisions of the Farm Security and Rural Investment Act of 

2002 (the farm bill). Specifically, we agreed to examine (1) actions that the 

U.S. Department of Agriculture (USDA) and other agencies have taken to 

carry out the farm bill requirement to purchase biobased products; (2) 

additional actions that may be needed to enhance implementation of this 

requirement; and (3) views of agencies, manufacturers, and testing 

organizations on the need for and costs of testing biobased products. 

To determine the actions USDA has taken to carry out the farm bill 

requirement for purchasing biobased products and to determine the 

additional actions that may be needed to enhance implementation of this 

requirement, we conducted interviews with USDA officials in the Office of 

Energy Policy and New Uses (New Uses office) and analyzed documents 

they provided to us. We also contacted officials in other USDA offices, 

including the Agricultural Research Service; Cooperative State Research, 

Education, and Extension Service; Office of General Counsel; and the 

Office of Procurement and Property Management (Procurement office). In 

addition, we spoke with officials at Iowa State University and the 

Department of Commerce’s National Institute of Standards and 

Technology (NIST) who are developing testing standards for biobased 

products under agreements with USDA. Furthermore, we reviewed 

USDA’s Guidelines for Designating Biobased Products for Federal 

Procurement, a proposed rulemaking published in the Federal Register on 

December 19, 2003. Related to this rulemaking, we attended two public 

meetings held by USDA in Washington, D.C.: a biobased workshop held on 

October 28, 2003, to discuss USDA’s use of biobased products and the 

status of the proposed rulemaking and a meeting on January 29, 2004, to 

allow the public an opportunity to comment on the proposed rule. 

To determine the actions that other federal agencies have taken to carry 

out the farm bill requirement to purchase biobased products, we 

interviewed officials at the top four procuring agencies—the Department 

of Defense (DOD), the Department of Energy (DOE), the General Services 

Administration (GSA), and the National Aeronautics and Space 

Administration (NASA)—and analyzed the documents that they provided 

to us. These agencies account for the majority—about 85 percent—of the 

federal government’s purchasing; the DOD alone accounts for about 67 

percent of federal purchasing. The officials we contacted included 

program staff who identify purchasing requirements and procurement staff 

who make the purchasing decisions, including the selection of vendors 

Appendix I: Objectives, Scope, and 

Methodology 
Appendix I: Objectives, Scope, and 

Methodology 

Page 43 GAO-04-437 Biobased Products 

and products used. They also included environmental management or 

health officials who may be responsible for promoting the use of biobased 

products at their agencies. We also interviewed officials at DOE, the 

Defense Logistics Agency, the Environmental Protection Agency (EPA), 

GSA, NASA, the Office of Management and Budget’s (OMB) Office of 

Federal Procurement Policy (OFPP), and the White House’s Office of the 

Federal Environmental Executive to determine the extent to which USDA 

had coordinated with these agencies in implementing the farm bill 

biobased purchasing requirement. 

To obtain the views of federal agencies, testing organizations, 

manufacturers, environmental groups, consumer groups, an advocacy 

group, and commodity associations on the need for and costs of testing 

biobased products, we contacted the following entities: 

• Federal agencies: DOD, DOE, EPA, GSA, NASA, OFPP, and White House’s 

Office of the Federal Environmental Executive. 

• Testing organizations: Iowa State University and NIST. 

• Manufacturers: Biobased Manufacturers Association and 15 biobased 

products manufacturers from a list of member companies provided by the 

association. The manufacturers chosen represent a cross section of 

biobased products—at least one producer in each of the 11 biobased item 

categories proposed by USDA—and feedstock (e.g., corn, soybeans, 

vegetable oils, etc.). They are also geographically dispersed: Arizona, 

California, Florida, Iowa, Illinois, Maryland, Massachusetts, Minnesota, 

Ohio, Texas, Washington, and Wisconsin. 

• Environmental groups: Environmental and Energy Study Institute and 

Green Seal. 

• Consumer groups: Center for the New American Dream and Consumer’s 

Choice Council. 

• Advocacy group: New Uses Council. 

• Commodity associations: American Soybean Association, National Corn 

Growers Association, and the United Soybean Board. 

Most of our contacts with these entities occurred prior to USDA’s 

publication of its guidelines for designating biobased products for 

procurement in December 2003, although we also obtained information 
Appendix I: Objectives, Scope, and 

Methodology 

Page 44 GAO-04-437 Biobased Products 

from some of these contacts after this document was published. In either 

case, in our interviews with these sources we sought their views on what 

the proposed guidelines should contain. In addition, for manufacturers of 

biobased products, we sought information on their experiences in selling 

to the government, including any impediments encountered. We also 

sought their views on the types of testing that should be done on biobased 

products; the associated costs of these tests; how testing costs should be 

paid; and how available federal funding for testing should be used. We 

summarized and contrasted the views of the various stakeholders. 

In general, our work focused on biobased products other than biofuels 

such as ethanol, biodiesel, and biogas because provisions to promote the 

production of biofuels are addressed elsewhere in the farm bill. However, 

some mention of biofuels was unavoidable in discussing the nature and 

importance of biobased products, including their effect on carbon in the 

environment and on their potential economic impact on farms and rural 

communities. 

We conducted our review from May 2003 through February 2004 in 

accordance with generally accepted government auditing standards. 
Appendix II: Sources for Information on 

Biobased Products 

Page 45 GAO-04-437 Biobased Products 

The following list provides the names, addresses, and Web sites for 

sources of information on biobased products used in our work. 

American Soybean Association 

12125 Woodcrest Executive Drive, Suite 100 

Creve Coeur, MO 63141-5009 

Web site: www.soygrowers.com 

Biobased Manufacturers Association 

11701 Borman Drive, Suite 300 

St. Louis, MO 63146-4193 

Web site: www.biobased.com 

Biomass Research & Development Initiative (DOE/USDA) 

U.S. Department of Energy 

1000 Independence Avenue, SW, Mail-Code EE-1 

Washington, D.C. 20585 

Web site: www.bioproducts-bioenergy.gov 

Biotechnology Industry Organization 

1225 Eye Street, NW, Suite 400 

Washington, D.C. 20005 

Web site: www.bio.org 

Consumer’s Choice Council 

1367 Connecticut Avenue, NW, Suite 300 

Washington, D.C. 20036 

Web site: www.consumerscouncil.org 

Environmental and Energy Study Institute 

122 C Street, NW, Suite 630, 

Washington, D.C. 20001 

Web site: www.eesi.org 

Green Seal 

1001 Connecticut Avenue, NW, Suite 827 

Washington, D.C. 20036-5525 

Web site: www.greenseal.org 

National Corn Growers Association 

632 Cepi Drive 

Chesterfield, MO 63005 

Web site: www.ncga.com 

Appendix II: Sources for Information on 

Biobased Products 
Appendix II: Sources for Information on 

Biobased Products 

Page 46 GAO-04-437 Biobased Products 

New Uses Council 

c/o Doane Agricultural Services 

11701 Borman Drive, Suite 300 

St. Louis, MO 63146-4193 

Web site: www.newuses.org 

Office of the Federal Environmental Executive 

1200 Pennsylvania Ave, NW, Mail 1600S 

Washington, D.C. 20460 

Web site: www.ofee.gov 

The Center for a New American Dream 

6930 Carroll Avenue, Suite 900 

Takoma Park, MD 20912 

Web site: www.newdream.org 

United Soybean Board 

16640 Chesterfield Grove Road, Suite 130 

Chesterfield, MO 63005-1429 

Web site: www.unitedsoybean.org 

USDA Office of Energy Policy and New Uses 

300 7th Street, SW, Room 361 

Washington D.C. 20024-0130 

Web site: www.biobased.oce.usda.gov 

USDA Biobased Products and Bioenergy Coordination Council 

Office of Technology Transfer 

Agricultural Research Service 

5601 Sunnyside Avenue, Room 4-1152 

Beltsville, MD 20705-5131 

Web site: www.ars.usda.gov/bbcc/ 

U.S. Department of Energy 

Industrial Technologies Program, EE-2F 

1000 Independence Ave., SW 

Washington, D.C. 20585 

Web site: www.oit.doe.gov/agriculture 
Appendix II: Sources for Information on 

Biobased Products 

Page 47 GAO-04-437 Biobased Products 

U.S. Environmental Protection Agency 

Comprehensive Procurement Guidelines 

Office of Solid Waste (5305W) 

1200 Pennsylvania Avenue, NW 

Washington, D.C. 20460 

Web site: www.epa.gov/cpg 
Appendix III: Key Provisions of USDA’s 

Proposed Guidelines 

Page 48 GAO-04-437 Biobased Products 

This appendix summarizes key provisions of USDA’s notice of proposed 

rulemaking, Guidelines for Designating Biobased Products for Federal 

Procurement, published in the Federal Register (69 Fed. Reg. 3533) on 

December 19, 2003. Specifically, table 2 describes proposed biobased 

product categories and the items to be included in each as discussed in the 

preamble to the proposed guidelines. Table 3 enumerates other key 

provisions proposed in the notice. 

Table 2: Proposed Biobased Product Categories and Related Items as Listed in the Preamble 

Product categories Types of items 

Adhesives • adhesive products 

• adhesive additives 

• finished products with biobased adhesives 

Construction materials and composites • construction material 

• composite panels 

• molded reinforced composites 

• insulating foams and films 

• components of mixed system products 

Fibers, paper, and packaging • fibers 

• fibers composites 

• composite packaging materials 

• woven fiber products 

• packaging materials 

• uncoated printing and writing papers 

• coated printing and writing papers 

• bristols 

• newsprint 

• sanitary tissues 

• paperboard and packaging products 

• other paper products 

Fuel additives • solid fuels 

• liquid fuel additives 

Landscaping materials, compost, and fertilizer • landscaping materials 

• compost 

• fertilizer 

Appendix III: Key Provisions of USDA’s 

Proposed Guidelines 
Appendix III: Key Provisions of USDA’s 

Proposed Guidelines 

Page 49 GAO-04-437 Biobased Products 

Product categories Types of items 

Lubricants and functional fluids • crankcase oils (water cooled engines) 

• crankcase oils (air cooled engines) 

• 2-cycle engine oils 

• fifth-wheel grease 

• automotive and other metal complex grease 

• total loss lubricants (wire rope, bar-chain, etc.) 

• turbine and other industrial lubricants 

• penetrating oils 

• general purpose and other 

• hydraulic, power steering, transmission fluids 

• brake fluids 

• cutting, drilling, and tapping oils (neat use) 

• metal working concentrates (for dilution) 

• forming pastes and extreme pressure stamping 

• concrete and asphalt release 

• metal foundry and mold release 

• transformer oil and dielectric fluids 

Plastics • biodegradable foams 

• durable foams 

• biodegradable films 

• durable films and coatings 

• water-soluble polymers 

• compostable molded products 

• molded plastics and composites/biobased resins 

• molded composites/biobased fibers 

• synthetic fibers 

Paints and coatings • formulated product 

Solvents and cleaners • formulated product 

• neat product (concentrate) 

Sorbents • sorbents 

• sorbent systems 

Plant and vegetable inks • news inks—black 

• news inks—color 

• sheet-fed inks 

• forms inks 

• heat-set inks 

• specialty inks 

Source: Preamble to USDA’s proposed guidelines. 
Appendix III: Key Provisions of USDA’s 

Proposed Guidelines 

Page 50 GAO-04-437 Biobased Products 

Table 3: Other Key Provisions of USDA’s Proposed Guidelines and Future Plans as Indicated in the Preamble 

Subject Key provisions 

Objectives of the guidelines • Determine the minimum level of biobased material a designated item must contain. 

• Propose items available for designation under the guidelines; explain the factors to be 

considered in their designation (availability, economic and technological feasibility, and 

life-cycle costs). 

• Identify in the guidelines the information on availability, relative price, performance, and 

environmental and public health benefits that USDA will provide to federal agencies on 

items designated for preferred procurement. 

• Set forth recommended practices for procuring biobased products and designated 

items. 

Biobased products proposed for 

exclusion 

• Biobased products that have mature markets. 

• Garments, household items, and industrial or commercial products made from silk, 

cotton, or wool, unless made with a substantial amount of a biobased plastic product. 

• Wood products made from traditionally harvested forest material. 

• Products having significant national market penetration prior to 1972. 

Federal agencies’ responsibilities • Give a procurement preference, with certain exceptions, to designated items with the 

highest percentage of biobased content practicable. 

• Incorporate in procurement specifications biobased item preferences consistent with the 

USDA guidelines. 

• Establish an agency affirmative procurement program that includes a biobased products 

preference program, an agency promotion program to promote the preference program, 

and an annual review to monitor the effectiveness of the agency’s procurement 

program. 

Biobased Web site USDA plans to 

• gather information on price, performance, and environmental and public health benefits 

from manufacturers and vendors for products, and store this information on a Web site; 

• invite manufacturers and vendors to voluntarily provide the noted information for the 

biobased products they intend to offer to federal agencies; and 

• use the voluntary, Web-based information system as the principal clearinghouse of 

information on manufacturer and vendor contact information, currently available 

products, and relevant product characteristics. 

Testing • USDA is authorized to use $1 million of the Commodity Credit Corporation’s funds per 

year for each of the fiscal years 2002 through 2007 to support testing requirements. 

• USDA will consider cost-sharing for products of small and emerging private businesses 

for Building for Environmental and Economic Sustainability (BEES) and performance 

testing. 

• Collection of test results information will differ based on whether the items have been 

designated as part of the preferential purchasing program. 

• Manufacturers that want to participate in the initial designation stage of the 

program must submit data for content, performance, and BEES testing. 

• Manufacturers that do not participate in the designation stage have the 

responsibility to inform federal procurement officials that the items comply with 

the USDA guidelines, including the biobased content of the product. When 

asked for such information from federal agencies, manufacturers and vendors 

must provide performance and BEES data. 
Appendix III: Key Provisions of USDA’s 

Proposed Guidelines 

Page 51 GAO-04-437 Biobased Products 

Subject Key provisions 

Voluntary labeling program • Biobased products that qualify for preferred procurement will be eligible for the 

“U.S.D.A. Certified Biobased Product” label, when this program is developed. 

• Eligibility in this program requires BEES analysis and specific performance testing. 

Source: USDA’s proposed guidelines and preamble to these guidelines. 
Appendix IV: Chronology of Steps Completed 

or Planned by USDA to Comply with the Farm 

Bill Requirements 

Page 52 GAO-04-437 Biobased Products 

Appendix IV: Chronology of Steps Completed 

or Planned by USDA to Comply with the 

Farm Bill Requirements 
Appendix IV: Chronology of Steps Completed 

or Planned by USDA to Comply with the Farm 

Bill Requirements 

Page 53 GAO-04-437 Biobased Products 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 54 GAO-04-437 Biobased Products 

Appendix V: Comments from the U.S. 

Department of Agriculture 

Note: GAO comments 

supplementing those in 

the report text appear at 

the end of this appendix. 

See comment 4. 

See comment 3. 

See comment 2. 

See comment 1. 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 55 GAO-04-437 Biobased Products 

See comment 11. 

See comment 10. 

See comment 9. 

See comment 8. 

See comments 4, 5, and 

6. 

See comment 7. 

See comment 6. 

See comment 5. 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 56 GAO-04-437 Biobased Products 

See comment 16. 

See comment 15. 

See comment 14. 

See comment 13. 

See comment 12. 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 57 GAO-04-437 Biobased Products 

See comment 17. 

See comment 18. 

See comment 19. 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 58 GAO-04-437 Biobased Products 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 59 GAO-04-437 Biobased Products 

The following are GAO’s comments on the U.S. Department of 

Agriculture’s letter dated March 23, 2004. 

1. On page 29 of the draft report (now p. 28), we state USDA’s view that 

their progress compares favorably to EPA’s implementation of its 

program for the purchase of recycled products. We also state that a 

comparison of USDA’s efforts to implement the biobased procurement 

provisions in section 9002 of the farm bill with government efforts to 

develop other preference programs, such as EPA’s program for the 

purchase of recycled products,1

 was outside the scope of our work. 

However, we have previously reported on EPA’s efforts to implement 

this program. Specifically, in May 1993, we reported that EPA’s efforts 

were slowed by a lack of a comprehensive, written strategy for 

completing this work.2

 Among other things, we noted that such a 

strategy would lay out funding and staff needs, goals and milestones, 

information and coordination needs, and a systemic approach to 

selecting items for procurement guidelines. We also noted that this 

strategy would serve as a basis for communicating EPA’s progress to 

the Congress and others, including the agency’s senior management. In 

addition, we reported that EPA’s efforts to fulfill the legislative 

provisions for the purchase of recycled products lacked priority and 

adequate staffing and resources, and because of the agency’s slow 

progress in identifying recycled products for preferred procurement, 

other federal procuring agencies had made little progress in developing 

their own affirmative programs for the purchase of these products. The 

conference report for the farm bill notes that the new program for the 

purchase of biobased products by federal agencies is modeled on the 

existing program for the purchase of recycled materials. Presumably, 

there are lessons to be learned from EPA’s experience in implementing 

the recycled program. However, more than 10 years after the issuance 

of our earlier report, we are now raising similar concerns regarding 

USDA’s implementation of the farm bill biobased procurement 

provisions. 

 1

Under the Resource Conservation and Recovery Act of 1976 (42 U.S.C. § 6962), the 

Congress directed federal procuring agencies to purchase items composed of recovered 

materials and directed EPA to designate the items agencies should purchase. 

2

U.S. General Accounting Office, Solid Waste: Federal Program to Buy Products With 

Recovered Materials Proceeds Slowly, GAO/RCED-93-58 (Washington, D.C.: May 17, 1993). 

GAO Comments 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 60 GAO-04-437 Biobased Products 

2. USDA is correct in stating that we do not offer an opinion on whether 

the farm bill time frame for full implementation of the biobased 

procurement program is realistic. This is a matter that USDA must 

address with the Congress. However, we do offer our views on how 

this implementation process might be accelerated. Regarding the 

specific factors that USDA cites as slowing this process, we believe 

these factors are adequately discussed in the draft report. On page 29 

(now p. 28), we acknowledge that the complexity and novelty of the 

issues that USDA faces are challenging. On page 26 (now p. 25), we 

state that the farm bill requires USDA to consult with other agencies, 

including EPA, GSA, and NIST. On page 28 (still p. 28), we also state 

that USDA provided us a list of work activities indicating that it 

conducted external consultations with other agencies during the 

summer and fall of 2002. On page 30 (still p. 30), we state that the farm 

bill did not specifically authorize funds for developing the biobased 

procurement guidelines. And on page 17 (now p. 16), we note that a 

number of rulemakings will be necessary to fulfill the farm bill 

biobased purchasing requirements and that the issuance of these 

rulemakings will take years to complete. We also describe on that page 

the steps in the rulemaking process. Furthermore, we make other 

statements in the draft report that reflect the difficulties USDA faces. 

For example, on page 4 (now p. 5) we state that USDA faces a 

formidable challenge in implementing the farm bill provisions for 

purchasing biobased products. On page 14 (still p. 14), we state that 

USDA was faced with an ambitious task regarding these provisions. 

And on page 25 (still p. 25), we note that USDA officials said that 

delays may result from having to work through the various concerns 

and conflicting views of the many stakeholders to this effort, a process 

that one official described as akin to swimming in molasses. 

3. We believe that factors such as the complexity and breadth of the 

issues to be considered, the internal and external consultation 

necessary, and the ambitious time frames for completing the work 

underscore the need for a comprehensive, written plan or strategy for 

the completion of this work was and is necessary. 

4. We did not ask for “a particular style of plan.” Beginning with our 

entrance meeting with USDA officials in May 2003, we asked for a copy 

of any written plan these officials had prepared that described how 

they intended to complete the work necessary to fulfill the farm bill 

biobased requirements. At that meeting, officials from the Office of 

Energy Policy and New Uses (New Uses office) stated that they did not 

have a written plan for this work, although the work had been ongoing 

for nearly a year. Approximately 9 months later, at our exit meeting 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 61 GAO-04-437 Biobased Products 

with USDA officials in February 2004, officials from the New Uses 

office provided us a draft document dated June 2002 as evidence of 

their planning. In our view, this document falls far short of being a 

comprehensive plan for completing this work, as discussed on pages 

27 to 28 of the draft report (still pp. 27 to 28). New Uses staff neither 

mentioned the existence of an “adaptive plan composed of several 

parts” during our work—May 2003 through February 2004—nor did 

they provide us documentation of this plan. In contrast, another USDA 

office, the Office of Procurement and Property Management 

(Procurement office), developed a comprehensive, written plan for the 

completion of its limited portion of the biobased work, which it 

provided to us in January 2004, soon after it identified funds to begin 

this work. 

5. After officials of the New Uses office told us in May 2003 that they did 

not have a written plan, we asked these officials if they had developed 

a list of tasks and associated milestones for their work. These staff 

indicated they had not done so, but would create this list for us. At the 

time, these staff indicated it would take them 2-3 weeks to develop this 

information. We received this timeline about 3 weeks later, in early 

June 2003. 

6. Other than the plan prepared by the Procurement office for its limited 

portion of the work, we have seen no evidence that USDA—

specifically the New Uses office—has a comprehensive, written plan 

for completing this work. 

7. We agree that in developing a plan it is not possible to anticipate every 

exigency. However, agencies frequently prepare “formal definitive” 

plans without being able to anticipate every possible exigency, 

including planning documents related to the Government Performance 

and Results Act, such as strategic and annual performance plans, and 

planning documents related to the day-to-day activities of agencies, 

such as the implementation of programs, legislative initiatives, and 

other activities. USDA appears to draw a distinction between 

consultations and planning—that consultations must precede planning. 

We believe that the need for consultations, including how these 

consultations will be done and documented, should be addressed 

along with other considerations in a comprehensive, written plan for 

completing the work needed to fulfill the farm bill biobased 

requirements. We note that the Procurement office addressed the need 

for consultations in the management plan it prepared for completing 

its portion of the biobased work. 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 62 GAO-04-437 Biobased Products 

8. On page 28 of the draft report (still p. 28), we state that USDA provided 

us a list of work activities indicating that it conducted external 

consultations with other agencies during the summer and fall of 2002. 

During our work, we discussed coordination issues with the agencies 

cited by USDA, as noted on page 26 of the draft report (now pp. 25 to 

26). In light of comments received from these other agencies on 

relevant excerpts of the draft report, the report has been clarified to 

identify some of the concerns these agencies cited. 

9. On pages 26 to 27 of the draft report (now p. 26), we state that the New 

Uses staff reports to the Chief Economist in periodic staff meetings 

and that this official periodically briefs the Secretary of Agriculture. 

The report has been clarified to reflect the frequency of these meetings 

and other reporting cited by USDA. However, we continue to believe 

that without a comprehensive, written plan for completing the 

biobased work, it is difficult for managers to put into context the 

relative progress being reported, to identify needed adjustments, and 

to hold accountable the officials responsible for the work’s 

completion. 

10. The draft report does not suggest that there were long periods when 

work was not progressing on the implementation of the biobased 

procurement program. However, the draft report does raise issues on 

whether this work has progressed efficiently in the absence of a 

comprehensive, written plan for its completion and a commitment of 

sufficient staff and financial resources and management attention. 

11. The report has been adjusted to make clear that the delay in receiving 

assistance from another office to help draft the Federal Register notice 

did not prevent other aspects of the work from proceeding. 

12. On page 28 of the draft report (still p. 28), we state USDA provided us a 

list of work activities indicating that it conducted external 

consultations with other agencies during the summer and fall of 2002. 

13. On page 44 of the draft report (now p. 43), we state that most of our 

audit work was done prior to USDA’s publication of its proposed rule 

in December 2003. This was a function of our need to be responsive to 

our requester’s time frames for completing the work and delays in 

USDA’s issuance of the proposed rule. However, subsequent to the 

rule’s publication, we also obtained relevant information and views 

from some contacts, including commentary on the proposed rule 

posted in newsletters or on Web sites of organizations such as the 

Biobased Manufacturers Association. In addition, we attended the 

public meeting held on January 29, 2004, at USDA headquarters in 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 63 GAO-04-437 Biobased Products 

Washington, D.C., in which stakeholders orally offered comments on 

the rule. 

14. The public comment period closed on February 17, 2004. USDA is 

currently analyzing and summarizing these comments. Eventually, 

USDA will discuss these comments in its final rulemaking for the 

biobased procurement guidelines. 

15. The report does not criticize the testing of life-cycle cost analysis and 

environmental and health effects as part of the proposed rule. The 

report reflects the views of a variety of relevant stakeholders regarding 

this and other testing issues. In a number of cases, these stakeholders 

offered negative or critical views, or otherwise expressed concerns. 

The report accurately reflects these views. 

16. In reviewing a copy of the Senator’s letter, we also note that he 

expressed several concerns. For example, he stated that USDA is many 

months behind the schedule Congress laid out for biobased product 

purchasing in the farm bill. Regarding testing, the Senator said that the 

BEES model should probably not be the only model allowed or 

required for life-cycle analysis of biobased products; he noted that the 

statute does not require it and that agencies themselves could 

determine which tests are necessary and incorporate them into their 

procurement guidelines. In addition, the Senator said that this 

information would be of little value to procurement agents if they do 

not have comparable life-cycle analysis results for petroleum-based 

counterparts. Furthermore, the Senator expressed concerns about the 

potential cost of testing on small and large businesses, suggested that 

biobased content be self-certified, and noted that agencies could 

require BEES analysis or other third-party testing in the event it is 

warranted, such as when the veracity of a manufacturer’s claim is in 

dispute. 

17. The report accurately states that USDA has fallen short in 

implementing the farm bill biobased purchasing requirements. The 

report accurately describes the content of the proposed rule, including 

what is addressed specifically in the proposed guidelines or in the 

preamble to these guidelines. It is factual that the proposed guidelines 

do not designate any items for preferred procurement or include the 

voluntary labeling program. 

18. The report states the time likely to be required to designate the items 

that USDA identified in the preamble to the proposed rule. This 

information is based on a timeline furnished by USDA. 
Appendix V: Comments from the U.S. 

Department of Agriculture 

Page 64 GAO-04-437 Biobased Products 

19. On pages 18 to 22 of the draft report (now pp. 18 to 21), we accurately 

reflect the views of some agency officials who believe that the 

advantages of biobased hydraulic fluids and lubricants are (1) the 

reduced cost and effort of cleanups of product spills, as compared 

with fossil resource-based alternatives and/or (2) the ease of disposal 

because these products are biodegradable. However, as noted on page 

22 (fnt. 29) of the draft report (now p. 21, fnt. 31), we discussed these 

views with EPA. The Director of EPA’s Oil Spill Staff stated that the 

agency had not made a specific ruling regarding how spills of biobased 

hydraulic fluids and lubricants should be handled; in the absence of a 

ruling, this official said that EPA does not make a distinction between 

spills of these biobased products and their petroleum-based 

alternatives. 
Appendix VI: GAO Contacts and Staff 

Acknowledgments 

Page 65 GAO-04-437 Biobased Products 

Lawrence J. Dyckman (202) 512-3841 

James R. Jones, Jr. (202) 512-9839 

In addition to the individuals named above, Jeanne Barger, Rani 

Chambless, and Carol Herrnstadt Shulman made key contributions to this 

report. Important contributions were also made by Oliver Easterwood, 

Lynn Musser, Anne Stevens, Amy Webbink, and Linda Kay Willard. 

Appendix VI: GAO Contacts and Staff 

Acknowledgments 

GAO Contacts 

Acknowledgments 
Related GAO Products 

Page 66 GAO-04-437 Biobased Products 

Federal Procurement: Government Agencies Purchases of Recycled–

Content Products. GAO-02-928T. Washington, D.C.: July 11, 2002. 

Federal Procurement: Better Guidance and Monitoring Needed to Assess 

Purchases of Environmentally Friendly Products. GAO-01-430. 

Washington, D.C.: June 22, 2001. 

Solid Waste: Federal Program to Buy Products With Recovered Materials 

Proceeds Slowly. GAO/RCED-93-58. Washington, D.C.: May 17, 1993. 

Solid Waste: Progress in Implementing the Federal Program to Buy 

Products Containing Recovered Materials. GAO/T-RCED-92-42. 

Washington, D.C.: Apr. 3, 1992. 

Related GAO Products 

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